Consider a world where the following 4 zero-coupon bonds are trading, each with a face value of $1000. The prices of the bonds are as follows:

1-year bond with a market price of $935.93

2-year bond with a market price of $860.65

3-year bond with a market price of $770.33

4-year bond with a market price of $690.50

Assuming the expectations hypothesis holds, what is the expected 3-year spot rate one year from today? Assume cashflows/coupons in this economy are paid annually.

7.95%

10.67%

10.00%

11.11%

9.68%