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Forward Rate. a. Assume that as of today, the annualized two-year interest rate is 0.08 , while the one-year interest rate is 0.06 . Assume

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Forward Rate. a. Assume that as of today, the annualized two-year interest rate is 0.08 , while the one-year interest rate is 0.06 . Assume that the liquidity premium on a two-year security is 0.001 . Use this information to re-estimate the one-year forward rate. Enter the answer in decimal form using 4 decimals (e.g. 0.1234)

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