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2. Consider the following information for general utility securities (bonds): Maturity Yield 1 year 5.0 2 years 5.5 3 years 6.0 4 years 5.5 What

2. Consider the following information for general utility securities (bonds):

Maturity Yield 1 year 5.0 2 years 5.5 3 years 6.0 4 years 5.5

What will the rates be two years from today and three years from today? Please use the expectations theory to compute the expected interest rates (yields) for each security one year from now.

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