According to the Expectations Theory of the Term Structure of Interest,if

question 56

Multiple Choice

According to the expectations theory of the term structure of interest,if the 1-year bond rate today is 6% p.a.and the 2-year bond rate today is 7% p.a. ,what is the 1-year bond rate next year?

• A)6%
• B)6.75%
• C)7.5%
• D)8%

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