You Find That the Yield on a 4-Year Bond Is

question 64

Multiple Choice

You find that the yield on a 4-year bond is 9% while the yield on a 2-year bond beginning four years from now is 10%.What should be the yield on a 6-yr bond as predicted by the expectations' theory?

• A) 1.00%
• B) 9.33%
• C) 14.32%
• D) 70.80%

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