If the 4-Year Spot Rate Is 7% and the 3-Year

question 38

Multiple Choice

If the 4-year spot rate is 7% and the 3-year spot rate is 6%, what is the one-year forward rate of interest three years from now?

• A) 10.0%
• B) 6.5%
• C) 9.6%
• D) None of the above

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Definitions:

Raven's Progressive Matrices

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Humanistic Psychologist

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