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The real risk-free rate is 1 percent. Inflation is expected to be 3.5 percent this year, 4.5 percent next year, and 5.5 percent thereafter. The
The real risk-free rate is 1 percent. Inflation is expected to be 3.5 percent this year, 4.5 percent next year, and 5.5 percent thereafter. The maturity risk premium is estimated to be 0.08 (t - 1)%, where t is the number of years to maturity. What is the yield on a 9-year Treasury note? a. 6.81% b. 0.72% c. 6.17% d. 5.14% e. 7.14%
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