Question: Given the Term Structure below: 1 year = 3 . 8 % 2 years = 4 . 7 % 3 years = 5 . 6

Given the Term Structure below:
1 year =3.8%
2 years =4.7%
3 years =5.6%
4 years =6.2%
5 years =7.9%
Based on the expectations hypothesis, what does the market expect the 1 year rate in 4 year to be?

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