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According to expectations theory if the 1 year interest is 2.5% this year and expected to be 3.5% next year, the 2 year interest rate

According to expectations theory if the 1 year interest is 2.5% this year and expected to be 3.5% next year, the 2 year interest rate should be approximately

a) 3%

b) 6%

c) 3.5%

d) 8.75%

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