The interest rate on the 2 year treasury securities. Introduction: Expectation Theory: Expectation theory estimates the future interest without considering the maturity risk. According to the expectation theory, the yield curve of investment totally depends upon the future expectation of the investors.

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Chapter 6, Problem 8P

Summary Introduction

To identify: The interest rate on the 2 year treasury securities.

Introduction:

Expectation Theory:

Expectation theory estimates the future interest without considering the maturity risk. According to the expectation theory, the yield curve of investment totally depends upon the future expectation of the investors.

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