On the 15th of May 2012 you enter a Forward Rate Agreement (FRA) to borrow onthe 15th of September 2012 $1000000 for 7 months at a fixed annualized interest rateof 5% (for a FRA with a contract length of 7 months the compounding frequency is127-times c.p.a.). What is the value of the FRA for you as a borrower on the 15thof August 2012 if (on the 15th of August) the 1-month spot rate is 3% (semi-annualcompounded) and the 8-month spot rate is 5% (monthly compounded)?