Question: 7. Assume that a 3-year Treasury note has no maturity premium, and that the real, risk-free rate of interest is 3 percent. If the T-note

7. Assume that a 3-year Treasury note has no maturity premium, and that the real, risk-free rate of interest is 3 percent. If the T-note carries a yield to maturity of 14.4 percent, and if the expected average inflation rate over the next 2 years is 12.4 percent, what is the implied expected inflation rate during Year 3?

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