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# The table below is the YTM of U.S. Treasuries with different maturities on March 22, 2021. 3 mo 6 mo 1 yr. 2 yr. 3 yr. 5 yr. 7 yr. 0.03 0.05 0.06 0.15 0.32 0.87 1.34 a. What

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## The table below is the YTM of U.S. Treasuries with different maturities on March 22, 2021. 3 mo 6 mo 1 yr. 2 yr. 3 yr. 5 yr. 7 yr. 0.03 0.05 0.06 0.15 0.32 0.87 1.34 a. What is the expected two-year rate in three years according to the Pure Expectations Theory? (4 marks) b. Find the risk premium of a 5-year bond and explain what that number means.

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## a According to the Pure Expectations Theory the expected two year rate in three years can be calcula View the full answer

**Related Book For**

## Understanding Basic Statistics

ISBN: 9781111827021

6th Edition

Authors: Charles Henry Brase, Corrinne Pellillo Brase

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