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The yield on a one-year Treasury security is 4.9200%, and the two-year Treasury security has a 7.3800% yield. Assuming that the pure expectations theory is
The yield on a one-year Treasury security is 4.9200%, and the two-year Treasury security has a 7.3800% yield. Assuming that the pure expectations theory is correct, what is the market's estimate of the one-year Treasury rate one year from now? ? 8.4150% O 9.9000% O 11.2860% 0 12.573096 Recall that on a one-year Treasury security the yield is 4.9200% and 7.3800% on a two-year Treasury security. Suppose the one-year security does not have a maturity risk premium, but the two-year security does and it is 0.4000%. What is the market's estimate of the one-year Treasury rate one year from now? O 7.718096 9.080090 O 11.5320% O 10.3510%
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