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ChiAdam
Jul 21, 2014, 06:03 PM
The real risk free rate is 2%. Inflation is expected to be 3% this year, 4% next year, and 3.5% theheafter. The maturity risk premium is estimated to be 0.0005 x (t-1), where t = number of years to maturity. What is the nominal interest rate on a 7-year Treasury?