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FinanceQ&A LibrarySuppose that the current 1-year rate ( 1-year spot rate) and expected 1-year T-bill rates over the following three years (i.e years 2,3, and 4 respectively) as follows: 1R1=6%, E(2r1)=7%,E(3r1)=7.5%,E(4r1)=7.85% Using the unbiased expectations theory, calculate the current (long-term) for one-, two-, three-, and four- year- maturity treasury securities. ( Round your answers to 2 decimal places.)Start your trial now! First week only $4.99!*arrow_forward*

Question

Suppose that the current 1-year rate ( 1-year spot rate) and expected 1-year T-bill rates over the following three years (i.e years 2,3, and 4 respectively) as follows:

1R1=6%, E(2r1)=7%,E(3r1)=7.5%,E(4r1)=7.85%

Using the unbiased expectations theory, calculate the current (long-term) for one-, two-, three-, and four- year- maturity treasury securities. ( Round your answers to 2 decimal places.)

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