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(e) Prices of zero-coupon bonds reveal the following pattern of interest rates: Years from now 0 1 2 1-year interest rate 5.8% 6.8% 8.2% Calculate:

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(e) Prices of zero-coupon bonds reveal the following pattern of interest rates: Years from now 0 1 2 1-year interest rate 5.8% 6.8% 8.2% Calculate: i) 2-year interest rate today and 3-year interest rate today. ii) 2-year forward rate 3 years from now if 5-year interest rate today is 8.3%

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