willkatt4 willkatt4
  • 26-03-2024
  • Business
contestada

Suppose 1-year Treasury bonds yield 4.00% while 3-year T-bonds yield 5.90%. Assuming the pure expectations theory is correct, and thus the maturity risk premium for T-bonds is zero, what is the yield on a 2-year T-bond expected to be one year from now?
5.81%
6.65%
6.86%
5.11%
5.05%

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