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Use the following to answer the next three questions. Years to Maturity Yield 1 .02 2 .05 3 .03 4 .06 5 .08 1. Find

Use the following to answer the next three questions.

Years to Maturity

Yield

1

.02

2

.05

3

.03

4

.06

5

.08

1. Find the market's forecast for one year rates, one year from now. Round intermediate steps to four decimals.

a)

.0809

b)

.0381

c)

.05

d)

None of the above

2. Find the market's forecast for two year rates, three years from today. Round intermediate steps and your final answer to four decimals. Enter you answer in decimal format (EX: .XXXX).

3. Find the market's forecast for four year rates, one year from today. Round intermediate steps and your final answer to four decimals. Enter your answer in decimal format (EX: .XXXX).

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