February 27, 2017

Homework Help: Finance

Posted by Anonymous on Wednesday, January 30, 2013 at 5:32pm.

A thirty-year U.S. Treasury bond has a 4.0 percent interest rate. In contrast, a ten-year Treasury bond has an interest rate of 3.7 percent. If inflation is expected to average 1.5 percentage points over both the next ten years and thirty years, determine the maturity risk premium for the thirty-year bond over the ten-year bond.

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