Assuming that the forward rate between year 1 and year 3,F0(1,3), is 5%, and the...
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Assuming that the forward rate between year 1 and year 3,F0(1,3), is 5%, and the forward rate between, year 3 and year 4,F0(3,4), is 6%. The current four-year zero rate is, R(0,4), is 5%. What is the current one-year zero rate R(0,1) ? (assume all rates are for continuous compounding) a) 2% b) 3% c) 4% d) 5% e) 6% f) None of the above
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