Which one of the following best explains the concept of the unbiased expectations theory?

The current yield curve is the market's expectations of current and future long$-$term rates.

Current long$-$term interest rates are geometric averages of current and future expected short$-$term rates.

The long term N $-$year rate is simply the current $1-$year rate raised to the Nth power.

Current long$-$term interest rates are arithmetic averages of current and future expected short$-$term rates.