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Assume that the interest rate on a 1-year Treasury security is currently 4% and the rate on a 2-year Treasury security is 5%. Assume also
Assume that the interest rate on a 1-year Treasury security is currently 4% and the rate on a 2-year Treasury security is 5%. Assume also that the pure expectations theory is correct. To the closest whole percent, what is a reasonable forecast of the rate on 1-year Treasury securities next year
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