Excel Online Structured Activity: Expectations Theory Interest rates on 4-year Treasury securities are currently 6.15%, while 6-year Treasury securities yield 7.95%. The data has been collected in the Microsoft Excel Online file below. Open the spreadsheet and perform the required analysis to answer the question below. X Open spreadsheet If the pure expectations theory is correct, what does the market believe that 2-year securities will be yielding 4 years from now? Calculate the yield using a geometric average. Do not round your intermediate calculations. Round your answer to two decimal places. % A B C D E F G Expectations Theory 4-yr. Treasury security yield 6-yr. Treasury security yield Algebraic solution: Total return earned on 6-year securities 1234567 6.15% 7.95% Formulas #N/A #N/A #N/A 8 9 Total return earned on 4-year securities Yield on 2-yr. securities, 4 years from now 10 11 Geometric solution: 12 13 1+ Total return earned on 6-year securities 1+ Total return earned on 4-year securities #N/A #N/A 14 Yield on 2-yr. securities, 4 years from now #N/A 15 16 17 18 19 20 21 22 23