Draw a graph showing a likely path of the 1 year rate

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Reference no: EM131220724

Suppose it is 2020, the 1-year interest rate is 8 percent, and the 10-year rate is 6 percent.

a. Draw a graph showing a likely path of the 1-year rate from 2020 through 2029.

b. Why might people expect such a path for the 1-year rate?

Reference no: EM131220724

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