Suppose the interest rate on a 1-year t-bond is 500 and, Ask an Expert

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Suppose the interest rate on a 1-year T-bond is 5.00% and that on a 2-year T-bond is 6.90%. Assuming the pure expectations theory is correct, what is the market's forecast for 1-year rates 1 year from now? Round the intermediate calculations to 4 decimal places and final answer to 2 decimal places.

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Financial Management, Finance

Category:- Financial Management
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