The One-Year Interest Rate Is 4

question 25

Multiple Choice

The one-year interest rate is 4.80 percent and the two-year interest rate is 5.13 percent.What is the one year interest rate one year from now? Assume the rates are effective annual rates.

• A) 5.02 percent
• B) 5.23 percent
• C) 5.46 percent
• D) 5.51 percent
• E) 5.74 percent

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