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You are given the following spot rates. Determine the 1 year forward rates at the beginning of year 0 through 7. Use annual compounding. Consider

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You are given the following spot rates. Determine the 1 year forward rates at the beginning of year 0 through 7. Use annual compounding. Consider the formula 8 8 (1+yo, Show that it holds for your forward rates, and explain in a sentence why it must be true 1(1+y:-1, i=1 Year n Rate yo,n 0.024 0.0245 0.026 0.027 O voo + w N - 0.0275 0.0275 0.028 0.029

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