Suppose that today the one-year Treasury note yields 0.12% (0.0012 in decimal form), the two-year note yields
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Question:
Suppose that today the one-year Treasury note yields 0.12% (0.0012 in decimal form), the two-year note yields 0.40% (0.0040), the three-year note yields 0.78% (0.0078), the five-year note yields 1.60% (0.0160), the seven-year note yields 2.22% (0.0222) and the ten-year note yields 2.81% (0.0281).Under the pure expectations theory with no maturity risk:
a)What is the expected yield on a one-year note delivered one year from now?
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