Expected Yield on Three-Year Treasury Bond

The term structure of interest rates plays a pivotal role in fixed income valuation, helping investors understand expected future rates and economic conditions. One common theory explaining the shape of the yield curve is the Expectations Theory. This theory posits that long-term interest rates reflect investor expectations about future short-term rates.

Assume that the current one-year Treasury yield is 2% and that the consensus expectation among investors is that interest rates will increase by 1% each subsequent year over the next three years. Based on this information, how would an investor expect the yield on a three-year Treasury bond to be priced today?