11 The term structure for zero-coupon bonds is currently: Maturity (Years) 1 YTM(8) 5.98 6.9 7.9 Next year at this time, you expect it to be: Maturity (Years) YTM(%) 6.9% 7.9 8.9 a. What do you expect the rate of return to be over the coming year on a 3-year zero-coupon bond? (Round your answer to 1 decimal place.) Rate of return % b-1. Under the expectations theory, what yields to maturity does the market expect to observe on 1- and 2-year zeros at the end of the year? (Round your answers to 2 decimal places.) YTM Maturity 1 % % 2 b-2. Is the market's expectation of the return on the 3-year bond greater or less than yours? O Greater O Less