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The Wall Street Journal reports that the rate on three-year Treasury securities is 6.25 percent and the rate on five-year Treasury securities is 6.45 percent.
The Wall Street Journal reports that the rate on three-year Treasury securities is 6.25 percent and the rate on five-year Treasury securities is 6.45 percent. According to the unbiased expectations hypothesis, what does the market expect the two-year Treasury rate to be three years from today, E(4r2)?
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6.35 percent
6.75 percent
7.25 percent
7.45 percent
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