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The following discount factors are observed : Tenor in Years Discount Factor 1 .9804 2 .9495 3 .9210 4 .8841 What is the approximate fixed

The following discount factors are observed:

Tenor in Years

Discount Factor

1

.9804

2

.9495

3

.9210

4

.8841

What is the approximate fixed rate on a four-year plain-vanilla interest rate swap?

  1. 1.525%
  2. 2.75%
  3. 3.10%
  4. 2.15%

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