delaneynagle3368
21.03.2020 •
Business
The yield on a one-year bond is currently 3% and the expected yield on one-year bonds for the next two years is 5% and 4%. If the liquidity premium is 1.75%, what is the yield on a bond with three years to maturity
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Ответ:
5.75%
Explanation:
The computation of the yield on a bond with three years to maturity is shown below:
Given that
Yield on a one-year bond is 3%
The expected yield on one-year bonds for the next two years is 5% and 4%
And, the liquidity premium is 1.75%
So, the yield on a bond with three years to maturity is
= (3% + 5% + 4%) ÷ 3 years + 1.75%
= 4% + 1.75%
= 5.75%
Ответ:
Translation
Explanation:
It just is