Question: Hiate 6-8 using a EXPECTATIONS THEORY Interest rates on 4-year Treasury securities are currently 6.7%, while 6-year Treasury securities yield 7.25%. If the pure expectations

Hiate 6-8 using a EXPECTATIONS THEORY Interest rates on 4-year Treasury securities are currently 6.7%, while 6-year Treasury securities yield 7.25%. If the pure expectations theory is correct, what does the market believe that 2-year securities will be yielding 4 years from now? Calculate the yield using a geometric average. nie 5 Inflation is expected to be 3.05% this

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