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Suppose that the interest rate on one year bonds is currently 3.5 percent and is expected to be 4 percent in one year and 6

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Suppose that the interest rate on one year bonds is currently 3.5 percent and is expected to be 4 percent in one year and 6 percent in two years. Using the expectations hypothesis, compute the yield curve for the next three years. Instructions: Enter your responses rounded to the nearest two decimal places. Yield for one-year bond Yield for two-year bond - Yield for three-year bond- 3.5% % %

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