Calculate the expected rate on a five-year treasury bond

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Question 1: The Wall Street Journal reports that the current rate on 5-year Treasury bonds is 2.55 percent and on 10-year Treasury bonds is 4.75 percent. Assume that the maturity risk premium is zero. Calculate the expected rate on a 5-year Treasury bond purchased five years from today, E(5r5).

Reference no: EM132495481

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