Suppose you observe the following zero- coupon bond prices per $1 of maturity payment: 0.95138...
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Accounting
Suppose you observe the following zero- coupon bond prices per $1 of maturity payment: 0.95138 (1-year), 0.89982 (2-year), 0.83488 (3-year). Compute r 0(1,3), the implied forward rate for a loan made at the end of year 1 and maturing at the end of year 3.
a. 8.11%
b. 6.75%
c. 7.78%
d.5.73%
e.6.98%
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