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Problem 6-15 Unbiased Expectations Theory (LG6-7) Suppose we observe the following rates: 1R1 = 5%, 1 R2 = 7%. If the unbiased expectations theory of

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Problem 6-15 Unbiased Expectations Theory (LG6-7) Suppose we observe the following rates: 1R1 = 5%, 1 R2 = 7%. If the unbiased expectations theory of the term structure of interest rates holds, what is the 1-year interest rate expected one year from now, E(261)? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Interest rate %

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