FORWARD RATE. Using the following data, calculate the forward rate on a $2-$year bond, $3$ years from today; i$.$e$.3$r$2.$

Bond $1$:

Coupon rate $=6(1)/(2)$

Maturity $=2$ years

YTM $=5\mathrm{.}49\%$

Bond $2$:

Coupon rate $=6$

Maturity $=3$ years

YTM $=5\mathrm{.}61\%$

Bond $3$:

Coupon rate $=7$

Maturity $=5$ years

YTM $=5\mathrm{.}72\%$

Bond $4$:

Coupon rate $=71/8$

Maturity $=8$ years

YTM $=5\mathrm{.}84\%$

Question $15$ options:

$1)$

$5\mathrm{.}85\%$

$2)$

$5\mathrm{.}87\%$

$3)$

$5\mathrm{.}89\%$

$4)$

None of the above