Question: Llsing the mpply and deand 30. Quantitative Problems (5 points) Please show all your work to get the full credit. a. Assume that as of

 Llsing the mpply and deand 30. Quantitative Problems (5 points) Please

Llsing the mpply and deand 30. Quantitative Problems (5 points) Please show all your work to get the full credit. a. Assume that as of today, the annualized two-year interest rate is 13 percent, while the one-year interest rate is 12 percent. Use this information to estimate the one-year forward rate. b. Assume that the liquidity premium on a two-year security is 0.3 percent. Use this information to estimate the one-year forward rate

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