What is the liquidity premium for year

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Suppose we observe the following rates:  1R1 = 0.50%,  1R2 = 1.00%, and E(2r1) = 0.909%.  If the liquidity premium theory of the term structure of risk-free rates holds, what is the liquidity premium for year 2, L2?

Liquidity premium %?

Reference no: EM131660539

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