Question: Suppose the annualized yield on a one - year security today is 0 . 0 2 . The markets expect the annualized yield on a

Suppose the annualized yield on a one-year security today is 0.02. The markets expect the annualized yield on a one-year security to be 0.03 one year from today, 0.01 two years from today, and 0.04 three years from today. Using the pure expectations theory, calculate the annualized yield on a three-year security today. (Enter the answer a as decimal, with 4 decimal places, e.g.0.1234. DO NOT ENTER IT AS 12.34%)

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