13 Jan

One-year Treasury bills currently earn 4.85 percent

by On: Finance - 0 Comment

Question: One-year Treasury bills currently earn 4.85 percent…

One-year Treasury bills currently earn 4.85 percent. You expect that one year from now, one-year Treasury bill rates will increase to 5.00 percent. If the unbiased expectations theory is correct, what should the current rate be on two-year Treasury securities?

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