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Forward Rates: Term 1 Year 2 Year 3 Year 5 Year 7 Year Rate 1.00% 1.80% 2.80% 4.00% 4.20% (1+i) * (1+2i3) = (1+i)5 (1+.018)2

Forward Rates: Term 1 Year 2 Year 3 Year 5 Year 7 Year Rate 1.00% 1.80% 2.80% 4.00% 4.20% (1+i) * (1+2i3) = (1+i)5 (1+.018)2 *(1+213) = (1+.04)5 Solve for 213 =
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Forward Rates

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