Suppose the real risk-free rate is 4.45% and the future rate of inflation is expected to be constant at 4.00%. What rate of return would you expect on a 1-year Treasury security, assuming the pure expectations theory is valid? Include cross-product terms, i.e., if averaging is required, use the geometric average. (Round your final answer to 2 decimal places.)

a. 8.45%

b. 4.45%

c. 4.63%

d. 4.18%

e. 8.63%