Question: The Wall Street Journal reports that the current rate on 10-year Treasury bonds is 2.25 percent and on 20-year Treasury bonds is 4.50 percent. Assume
The Wall Street Journal reports that the current rate on 10-year Treasury bonds is 2.25 percent and on 20-year Treasury bonds is 4.50 percent. Assume that the maturity risk premium is zero. Calculate the expected rate on a 10-year Treasury bond purchased ten years from today, E(10r10).
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