Question: Suppose that a commoditys respective forward prices for 1 year and 2 years are $55 and $63. The 1-year effective annual interest rate is 6.1%,

Suppose that a commoditys respective forward prices for 1 year and 2 years are $55 and $63. The 1-year effective annual interest rate is 6.1%, and the 2-year interest rate is 6.4%. You will pay a fixed rate of $58.87033 in a 2-year swap and receive the floating rate. At the time you enter the swap contract, its value to you is...(show work)

a. $0.0236

b. $0.0169

c. $0.0236

d. $0.0169

Suppose that a commoditys respective forward prices for 1 year and 2 e. $0.0000

Suppose the 1-year effective annual interest rate is 3.3%, the 2-year interest rate is 4.1%, and the 3-year interest rate is 4.7%. Compute the fixed rate in a 3-year interest rate swap.(show work)

years are $55 and $63. The 1-year effective annual interest rate is a. 4.66%

b. 5.03%

c. 4.92%

d. 4.01%

e. 11.11%

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