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The WSJ reports that the rates on 4 - and 5 -year Treasuries are 4.36% and 4.25%, respectively, You estimate that the 1 year rate

The WSJ reports that the rates on 4 - and 5 -year Treasuries are 4.36% and 4.25%, respectively, You estimate that the 1 year rate expected in year 5,E(r5), is 3.57%. Based on the liquidity preference theory, what should the liquidity premium on the 5-year Treasuries be? A. 0.241% B. 0.116% C. 0.135% D. 0.088%

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