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Question 21 Assume the current interest rate on a one-year Treasury bond (1R2) is 5.25%, and the current rate on a three-year Treasury bond (1R3)

Question 21 Assume the current interest rate on a one-year Treasury bond (1R2) is 5.25%, and the current rate on a three-year Treasury bond (1R3) is 6.5%. If the unbiased expectations theory of the term structure of interest rates is correct, what is the one-year interest rate expected on Treasury bills during year 3 (E(3r1) or3f1)?

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