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6. Suppose the interest rate on a 1-year T-bond is 4.0% and that on a 2-year T-bond is 5.0%. Assuming the pure expectations theory is

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6. Suppose the interest rate on a 1-year T-bond is 4.0% and that on a 2-year T-bond is 5.0%. Assuming the pure expectations theory is correct, what is the market's forecast for 1-year rates 1 year from now? a. 7.36% b. 7.01% e. 8.16% d. 6.01% e. 9.04%

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