possible answers:

3.9

4.1

4.3

4.9

5.1

Question You are given the following table of spot rates: Time Spot Rate 1 3.1% 22 3.3% 3 3.8% 14 4.2% 14.7% Lillian enters into a deferred swap with settlement at the end of the year. She wants to swap the floating interest rates for a fixed interest rate during the third and fourth year Given a notional amount of 100.000 in years 3 and 4 determine the deferred swap rate