The yield on a one-year Treasury security is 4.6900%, and the two-year Treasury security has a 7.0350% yield. Assuming that the pure expectations theory is correct, what is the markets estimate of the one-year Treasury rate one year from now? (Note: Do not round your intermediate calculations.)

8.0176%

11.9793%

9.4325%

10.753%

Recall that on a one-year Treasury security the yield is 4.6900% and 7.0350% on a two-year Treasury security. Suppose the one-year security does not have a maturity risk premium, but the two-year security does and it is 0.25%. What is the markets estimate of the one-year Treasury rate one year from now? (Note: Do not round your intermediate calculations.)

8.922%

7.5837%

11.3309%

10.1711%

Suppose the yield on a two-year Treasury security is 5.83%, and the yield on a five-year Treasury security is 6.20%. Assuming that the pure expectations theory is correct, what is the markets estimate of the three-year Treasury rate two years from now? (Note: Do not round your intermediate calculations.)

6.69%

6.45%

6.53%

7.10%