Suppose 1-year treasury bonds yield 390 while 2-year, Financial Management

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Suppose 1-year treasury bonds yield 390 while 2-year

Suppose 1-year Treasury bonds yield 3.90% while 2-year T-bonds yield 4.10%. Assuming the pure expectations theory is correct, and thus the maturity risk premium for T-bonds is zero, what is the yield on a 1-year T-bond expected to be one year from now?

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Financial Management: Suppose 1-year treasury bonds yield 390 while 2-year

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