Anticipate the yield on 1-year treasury 1-year from now
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One year treasury securities yield 6.9 percent, while 2-year Treasury securities yield 7.2 percent. If the expectations theory is correct (that is, the maturity risk premium = 0) what does the market anticipate will be the yield on 1-year treasury securities on one year from now?
a. 6.0%
b. 6.7%
c. 7.2%
d. 7.5%
e. 8.0%.
https://brainmass.com/business/finance/anticipate-yield-year-treasury-year-now-28869
Solution Preview
One year treasury securities yield 6.9 percent
2-year Treasury ...
Solution Summary
The solution shows the calculation to arrive at the correct answer for the yield.
$2.49