Use the spot rates below for question. Assume for any swap that the variable rate of the swap is reset annually to the beginning of year one-year spot rate and payments settle annually at the end of the year.

Time	Spot Rate
1	2.00%
2	3.00%
3	3.50%
4	4.00%
5	4.50%

1. A company enters into a deferred interest rate swap, paying a fixed rate and receiving a variable rate for three years starting at the end of the third year . There are no payments at the end of the first or second years. What is the fixed interest rate of the swap?