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Suppose we observe the following rates: 1 R 1 = 4 % , 1 R 2 = 5 % . If the unbiased expectations theory

Suppose we observe the following rates: 1R1=4%,1R2=5%. 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(2r1)?

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