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Suppose we observe the three-year Treasury security rate (1R3) to be 12 percent, the expected one-year rate next year E (2r1)to be 8 percent, and

Suppose we observe the three-year Treasury security rate (1R3) to be 12 percent, the expected one-year rate next year E (2r1)to be 8 percent, and the expected one-year rate the following year E (3r1)to be 10 percent. If the unbiased expectations theory of the term structure of interest rates holds, what is the one-year Treasury security rate? The answer should be (18.26% / 0.1826) Possible to do this on excel

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