Question: Maturity Yield: 1 year - 3.0% 2 years - 4.0% 5 years - 5.0% 1 0 years- 6.0% 30 years - 7.0% If PEH holds,

Maturity Yield:

1 year - 3.0%

2 years - 4.0%

5 years - 5.0%

10 years- 6.0%

30 years - 7.0%

If PEH holds, what does the market expect will be the interest rate on one-year securities, one year from now? Three-year securities, two years from now?

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