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The on-year forward rate for year 2 is 4%. The expected spot rate at the end of year 2 on a zero-coupon bond maturing at

The on-year forward rate for year 2 is 4%. The expected spot rate at the end of year 2 on a zero-coupon bond maturing at the end of year 4 is 7%. The four year expected spot rate is 7%. Determine the one-year spot rate. A. 31.57% B. 26.65% C. 22.96% D. 18.23% E. 10.09%

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