Find rate of return expect on five year treasury security


Assume real risk-free rate is 2.50% and future rate of inflation is expected to be steady at 3.80%. Find rate of return would you expect on the 5-year Treasury security, suppose pure expectations theory is valid? Disregard cross-product terms, that is, if averaging is needed, use arithmetic average.

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Mathematics: Find rate of return expect on five year treasury security
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