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Suppose that the forward rate is r(t) = 0.032 + 0.001t + 0.0002t 2 . (a) What is the 5-year continuously compounded spot rate? (b)

Suppose that the forward rate is r(t) = 0.032 + 0.001t + 0.0002t². (a) What is the 5-year continuously compounded spot rate? (b) What is the price of a zero-coupon bond that matures in 5 years?

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