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Calculate the yield using a geometric average

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Please provide step-by-step explanations. Thank you!6.7 Expectation theory One year Treasury securities yield 4.85%. The market anticipates that 1 year from now, 1-year Treasury securities will yield 5.2%. If the pure expectations theory is correct, what is the yield today for 2-year Treasury securities? Calculate the yield using a geometric average.

Reference no: EM132799719

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