Analysts have forecasted short-term, one-year interest rates over the next 4 years to be 2.5%, 8%, 11%, and 5.5%, respec

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answerhappygod
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Analysts have forecasted short-term, one-year interest rates over the next 4 years to be 2.5%, 8%, 11%, and 5.5%, respec

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Analysts have forecasted short-term, one-year interest rates
over the next 4 years to be 2.5%, 8%, 11%, and 5.5%, respectively.
According to expectations theory, the yield on a discount bond with
a three year maturity should be ____ and yield on bond with a four
year maturity should be ____.
7.17%; 6.75
7.17%; 6.45%
7.35%; 6.75%
7.35%; 6.45%
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