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U.S. Treasury STRIPS, close of business November 15, 2015: Maturity Price Maturity Price November 16 99.471 November 19 95.035 November 17 98.782 November 20 92.570
U.S. Treasury STRIPS, close of business November 15, 2015:
| Maturity | Price | Maturity | Price | ||||||||||
| November 16 | 99.471 | November 19 | 95.035 | ||||||||||
| November 17 | 98.782 | November 20 | 92.570 | ||||||||||
| November 18 | 96.827 | November 21 | 89.342 | ||||||||||
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a. According to the pure expectations theory of interest rates, how much do you expect to pay for a five-year STRIPS on November 15, 2016? (Do not round intermediate calculations. Enter your answer as a percent rounded to 3 decimal places.)
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b. According to the pure expectations theory of interest rates, how much do you expect to pay for a two-year STRIPS on November 15, 2018? (Do not round intermediate calculations. Enter your answer as a percent rounded to 3 decimal places.)
| price | % |
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