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Consider the following spot interest rates for maturities of one, two, three, and four years. r 1 = 5.4% r 2 = 5.9% r 3
Consider the following spot interest rates for maturities of one, two, three, and four years. |
r1 = 5.4% r2 = 5.9% r3 = 6.6% r4 = 7.4% |
What are the following forward rates, where f1, k refers to a forward rate for the period beginning in one year and extending for k years? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) |
f1,1 | % |
f1,2 | % |
f1,3 | % |
F1,1 = 6.4 % F1,2 is not 8.01 F1, 3 is not 9.84 |
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