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Suppose the interest rate on a 1-year T-bond is 5.30% and that on a 2-year T-bond is 7.60%. Assuming the pure expectations theory is correct,

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Suppose the interest rate on a 1-year T-bond is 5.30% and that on a 2-year T-bond is 7.60%. Assuming the pure expectations theory is correct, what is the market's forecast for 1-year rates 1 year from now? Do not round your intermediate calculations. Round your final answer to 2 decimal places. a. 6.45% b. 9.95% c. 6.14% d. 10.48% e. 7.52%

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