Question: 5) Given the term structure below Term (years) Today's Rate 1 3.00% 2 3.12% 3 3.23% Based on the expectations hypothesis, what does the market

5) Given the term structure below

Term (years) Today's Rate
1 3.00%
2 3.12%
3 3.23%

Based on the expectations hypothesis, what does the market expect the 1 year rate in 1 year to be?

3.35%
3.40%
3.45%
3.08%
3.24%

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