QuantForcesquant interview practice

RB_CH03_Q008. Term-structure 7.60% 7.15% implied forward

difficulty 1600·answer type: numeric·Not solved

Problem

From the term-structure of interest rates, you see that the two-year spot rate is 7.60% per annum, and the one-year spot rate is 7.15% per annum. What is the implied forward rate for the second year?

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