What ere the current interest rates on two year

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Suppose that interest rates for one year bonds are expected to follow this pattern: 8% today, 10% one year from now on and 15% two years from now. Term premium is 0,01 per year. What ere the current interest rates on two year and three year bonds, according to

a) Liquidity premium theory?

b) Segmented markets theory?

Reference no: EM132411043

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