Question: Suppose that zero interest rates with continuous compounding are as follows: Maturity (years) 1, 2 , 3. Zero Rates (% per annum) 2.0, 3.0, ?

Suppose that zero interest rates with continuous compounding are as follows:

Maturity (years) 1, 2 , 3.

Zero Rates (% per annum) 2.0, 3.0, ? .

Forward rates (% per annum). -, ? , 5.1 .

Calculate the forward rate from year 1 to year 2 and calculate the zero rate year 3.

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