In the capital markets, a forward rate is presented with two numbers (it should be in subscript). The left one indicates the begining period for the contract while the right one indictes the ending period. For example, 2f4=5% indicates that investors will enter a lending agreement in year 2 and end in year 4. The annual interest rate for the 2(4-2)-years contract in this illustrative example is 5%. Now we have r1=3.5%, r2=4%, r3=4.5%, 2f4=5%, what should be the price of a 4 year zero-coupon bond with a par value of 1000?

Question 16 options:

	The answer is 842.61
	The answer is 880.53
	The answer is 838.60
	The answer is 872.14

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