Question: Assume expectations hypothesis is true. Today, a 1 - year bond has an annualized rate of return of 1 1 % per year. A 2

Assume expectations hypothesis is true. Today, a 1-year bond has an annualized rate of return of 11% per year. A 2-year bond has an annualized rate of return of 15% per year. A 3-year bond has an annualized rate of return of 16% per year. What is the forward rates for a 1-year bond in the second year?

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