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Given the Term Structure below: 1year=3.1%2years=4.2%3years=5.7%4years=6.8%5years=8% Based on the expectations hypothesis, what does the market expect the 1 year rate in 4 year to be?

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Given the Term Structure below: 1year=3.1%2years=4.2%3years=5.7%4years=6.8%5years=8% Based on the expectations hypothesis, what does the market expect the 1 year rate in 4 year to be? Enter your answer as a percentage, without the percentage sign ("\%), and rounded to 1 decimal. Example: if your answer is 0.12345 , that's equivalent to 12.3%, so enter 12.3 Question 10 5pts If the market expects interest rates to fall in the future, what shape would you expect to see in a graph of the Term Structure? Downward sloping Upward sloping Humped Flat None of these are correct

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