Question: Suppose that zero interest rates with continuously compounding are as follows: Maturity (years) Zero rate (% per annum) Forward rate (%) 0.5 4 1.0 4.5

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

Maturity (years) Zero rate (% per annum) Forward rate (%)
0.5 4
1.0 4.5
1.5 4.75
2.0 5

Calculate one-year, 1.5-year, and two-year forward rates. Show working

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