If the One-Year Spot Interest Rate Is 6 Percent and the Two-Year

question 58

Multiple Choice

If the one-year spot interest rate is 6 percent and the two-year spot interest rate is 7 percent, calculate the one-year forward interest rate one year from today.

• A)6.5 percent
• B)7 percent
• C)7.5 percent
• D)8 percent

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Definitions:

Histidine

An essential amino acid in humans, involved in the growth and repair of tissues and the production of histamine.

Organic Products

Compounds containing carbon that are produced as a result of organic reactions.

Amino Acid Analyzer

A device that is used for the identification and quantification of amino acids in a sample, typically using chromatographic techniques.

Amino Acids

Organic compounds containing both amino and carboxyl groups, serving as the building blocks of proteins.