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The wall street journal reports that the rate on three-year

Question: The Wall Street Journal reports that the rate on three-year Treasury securities is 5.25 percent and the rate on four-year Treasury securities is 5.50 percent. The one-year interest rate expected in three years, E (₄r₁), is 6.10 percent. According to the liquidity premium hypotheses, what is the liquidity premium on the four-year Treasury security, L4?

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Finance Basics: The wall street journal reports that the rate on three-year

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