What is the maturity risk premium on the 2-year treasury


1. A 2-year Treasury security currently earns 4.00 percent. Over the next two years, the real interest rate is expected to be 2.13 percent per year and the inflation premium is expected to be 1.33 percent per year. What is the maturity risk premium on the 2-year Treasury security?

2. A STRIPS traded on May 1 2014, matures in 18 years on May 1 2032. Assuming a 5.6 percent yield to maturity, what is the STRIPS price?

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Financial Management: What is the maturity risk premium on the 2-year treasury
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