Question: Please explain this question step by step, if PEH holds, what is the market expectation of interest rate on 3 years of security, 1 year

Please explain this question step by step, if PEH holds, what is the market expectation of interest rate on 3 years of security, 1 year from now? Please draw the graph of this equation.

Maturity Years 1 Year 6.0% 2 Years 6.1% 3 Years 6.2% 4 Years 6.3% 5 Years 6.4% 6 Years 6.5%

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