Expected interest rate the real risk-free rate is 255


Expected Interest Rate The real risk-free rate is 2.55%. Inflation is expected to be 3.35% this year, 4.75% next year, and then 3.1% 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? Round your answer to two decimal places.

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Financial Management: Expected interest rate the real risk-free rate is 255
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