Question: Why is my year 4 incorrect?? Based on economists' forecasts and analysis, 1-year Treasury bill rates and liquidity premiums for the next four years are

 Why is my year 4 incorrect?? Based on economists' forecasts and

Why is my year 4 incorrect??

Based on economists' forecasts and analysis, 1-year Treasury bill rates and liquidity premiums for the next four years are expected to be as follows: = = R1 E(201) E(3r1) E(481) 0.65% 1.75% L2 1.85% L3 2. 15% L4 = 0.05 0.10% = 0.12% = Using the liquidity premium theory, determine the current (long-term) rates. (Do not round intermediate calculations. Round your answers to 2 decimal places.) X Answer is complete but not entirely correct. Year Current (Long-term) Rates 0.65 % 1 2 1.22 % 3 1.46 % 4 1.70 X %

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!