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You observe the following yield curve for Treasury securities: Maturity Yield 1 year 6.0% 2 years 5.8 3 years 5.5 4 years 5.6 5 years

You observe the following yield curve for Treasury securities:

Maturity Yield 1 year 6.0% 2 years 5.8 3 years 5.5 4 years 5.6 5 years 5.8

Assume that the expectations theory holds. What does the market expect that three-year interest rates will be one year from today?

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