BA350 Financial Management: 5-4 Determinant of Interest Rates

BA350 Financial Management

5-4 Determinant of Interest Rates
The real risk-free rate of interest is 4%. Inflation is expected to be 2% this year and 4% during the next 2 years. Assume that the maturity risk premium is zero. What is the yield on 2-year Treasury securities? What is the yield on 3-year Treasury securities?
Powered by