1. Suppose the current 1 -year rate is 2 percent. Market expects the 1 -year rate a year from now to be 3 percent and the 1 -year rate 2 years from now to be 5 percent. Based on the expectations theory of term structure of interest rates, compute the current 3 -year rate of interest. Use the following information to answer questions 2 - 3. Suppose the 1-year spot rate is 4 percent, the 2 -year spot rate is 6 percent (annually), and the 3 -year spot rate is 8 percent (annually). 2. Based on the expectations theory of term structure of interest rates, compute the forward rate on a 1-year bond originating 1 year from now. 3. Based on the expectations theory of term structure of interest rates, compute the forward rate on a 1-year bond originating 2 years from now