Mathematics, 28.09.2019 02:30, jackb9361

Treasury securities that mature in 6 years currently have an interest rate of 8.50 percent. inflation is expected to be 5 percent in each of the next three years and 6 percent each year thereafter. the maturity risk premium is estimated to be 0.10% × (t – 1), where t is equal to the maturity of the bond (i. e., the maturity risk premium of a one-year bond is zero). the real risk-free rate is assumed to be constant over time. what is the real risk-free rate of interest?

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Treasury securities that mature in 6 years currently have an interest rate of 8.50 percent. inflatio...