A trader has entered into a forward rate agreement in which it will receive 4.5% based on quarterly compounding for a three-month period starting in 9 months. The notional value of the forward rate agreement is $10,000,000. Note that the spot zero rates in the table below are based upon continuous compounding. a. Given the data below, what is the value of a forward rate agreement? b. Provide two ways in which the trader can hedge the risk of the forward rate agreement? Maturity (months) Spot Zero Rates Spot Rates % per annum (based upon continuous compounding) 2 4 3 6 9 6 12 8 15 10 18 12 A trader has entered into a forward rate agreement in which it will receive 4.5% based on quarterly compounding for a three-month period starting in 9 months. The notional value of the forward rate agreement is $10,000,000. Note that the spot zero rates in the table below are based upon continuous compounding. a. Given the data below, what is the value of a forward rate agreement? b. Provide two ways in which the trader can hedge the risk of the forward rate agreement? Maturity (months) Spot Zero Rates Spot Rates % per annum (based upon continuous compounding) 2 4 3 6 9 6 12 8 15 10 18 12