The maturity risk premium is estimated to be 005t-1 where t

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The real rish-free rate is 3 percent. Inflation is expected to be 3percent this year, 4 percent next year, and then 3.5 percent thereafter. The maturity risk premium is estimated to be 0.05*(t-1)%, where t = number of years to maturity. What is the yield on a 7 year Treasury note?

Reference no: EM13573413

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