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Consider the following market information: Maturity/Time Par Rates Spot Rates 1-yr Forward Rates 1 1.500% ? 1.500% 2 ? ? 1.299% 3 ? ? 1.096%

  1. Consider the following market information:

    Maturity/Time

    Par Rates

    Spot Rates

    1-yr Forward Rates

    1

    1.500%

    ?

    1.500%

    2

    ?

    ?

    1.299%

    3

    ?

    ?

    1.096%

    What is the three-year spot rate?

    1.298%

    1.500%

    1.472%

    1.332%

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