What is the yield to maturity for treasury bonds

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Problem - Today is January 2, 2019, and investors expect the annual risk-free interest rates in 2019 through 2021 to be

Year

One-Year Rate (rRF)

2019

2.2%

2020

1.8

2021

2.9

Required - What is the yield to maturity for Treasury bonds that mature at the end of

(a) 2020 (a two-year bond)

(b) 2021 (a three-year bond)? Assume the bonds have no risks.

Reference no: EM132697348

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