Possible Answers

A. 2.04%

B. 4.05%

C. 4.74%

D. 4.77%

E. 4.83%

The term and price of zero-coupon bonds are given in the following table: Time to maturity Price 1 .98 2 .91 3 .87 4 .83 Alan enters into a four-year swap. He wants to swap the floating interest rates for a fixed interest rate. The level notional amount of the swap is 1000 each year. Determine the swap rate