Question: [Related to Solved Problem 5.2bl Use the data on Treasury securities in the following table to answer the question: Date 03/05/2010 1 year 0.4% 0.88%

 [Related to Solved Problem 5.2bl Use the data on Treasury securities

[Related to Solved Problem 5.2bl Use the data on Treasury securities in the following table to answer the question: Date 03/05/2010 1 year 0.4% 0.88% 1.56% Source: U.S. Department of the Treasury Assuming that the liquidity premium theory is correct, on March 5, 2010, what did investors expect the interest rate to be on the one-year Treasury bill two years from that date if the term premium on a two-year Treasury note was 0.01% and the term premium on a three-year Treasury note was 0.03%? The expected interest rate is % Round your response to two decimal places)

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