Suppose 2-year treasury bonds yield 4.5%, while 1-year bonds yield 3%. r * is 1%, and the maturity risk premium is zero. using the expectations theory, what is the yield on a 1-year bond 1 year from now? calculate the yield using a geometric average.
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Home » Business » Suppose 2-year treasury bonds yield 4.5%, while 1-year bonds yield 3%. r * is 1%, and the maturity risk premium is zero. using the expectations theory, what is the yield on a 1-year bond 1 year from now? calculate the yield using a geometric average.