Question: Consider a permanent payment under plain vanilla. interest rate swap which is paid in advance in following settings. The start date is I year and

Consider a permanent payment under plain vanilla. interest rate swap which is paid in advance in following settings. The start date is I year and maturity is 2 years. The floating rate is 24 months. Floating rate is 6-month USD Libor. The rate of swap trading is 5%.

Based on the above information with hypothetical setting. Construct synthetic equivalent or imitation Of this swap under two Forward Rate Agreements (FRA). Also discuss the prime parameters of FRAs

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