The Wall Street Journal reports that the rate on three-year Treasury securities is 7.25 percent and the rate on four-year Treasury securities is 8.50 percent. The one-year interest rate expected in three years is E( ₄r ₁), 4.10 percent. According to the liquidity premium theory, what is the liquidity premium on the four-year Treasury security, L ₄?

		6.7 percent
		8.2 percent
		9.6 percent
		7.1 percent