Business, 08.11.2019 04:31 Tuxkie

An investor in treasury securities expects inflation to be 1.6% in year 1, 3.05% in year 2, and 3.85% each year thereafter. assume that the real risk-free rate is 2.35% and that this rate will remain constant. three-year treasury securities yield 6.80%, while 5-year treasury securities yield 8.10%. what is the difference in the maturity risk premiums (mrps) on the two securities; that is, what is mrp5 - mrp3? do not round intermediate calculations. round your answer to two decimal places.

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An investor in treasury securities expects inflation to be 1.6% in year 1, 3.05% in year 2, and 3.85...

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