Length of Investment in Year	Spot Interest Rates
1	r1 = 2.0%
2	r2 = 2.5%
3	r3 = 3.0%
4	r4 = 3.5%
5	r5 = 4.0%

General Manufacturing borrowed 1,000,000 for five years at a variable interest rate. They will pay interest annually and repay the principal in a lump sum at the end of five years.

General Manufacturing entered into a swap agreement with a level notional amount of 1,000,000. They agreed to pay a constant interest rate R at the end of each year for five years in return for a variable payment based on the spot rate at the beginning of the year. Using the interest rate table above, calculate the swap rate R.