Maturity risk premium is estimated

Reference no: EM131350863

Expected Interest Rate

The real risk-free rate is 2.25%. Inflation is expected to be 2.45% this year, 4.25% next year, and 2% thereafter. The maturity risk premium is estimated to be 0.05(t - 1)%, where t = number of years to maturity. What is the yield on a 7-year Treasury note? Do not round your intermediate calculations. Round your answer to two decimal places.

Reference no: EM131350863

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