[Questions 22-23] The current term-structure of spot rates is as follows (with con- tinuous compounding): Maturity (years) Zero-rate(%) 1 3.0 2 4.5 3 5.5 22. What is the implied forward rate ro(2, 3)? (a) 6.00% (b) 6.75% (c) 7.50% (d) 7.53% 23. A bank offers a special bond A through which investors can borrow (lend) $100 in year 2 and repay (receive) $100x20.07 in year 3. Is there an arbitrage? If so, what is the arbitrage's net cash flow in year 0? (Consider an arbitrage strategy where we use one unit of bond A and the net cash flows are zero from years 1 through 3) (a) 0.392 (b) 0.456 (c) 0.499 (d) 0.538