Today's Forward Rate $f \left( t _ { 1 } , t _ { 2 } \right)$

question 20

Multiple Choice

Today's forward rate $f \left( t _ { 1 } , t _ { 2 } \right)$ for a period $\left( t _ { 1 } , t _ { 2 } \right)$ in the future ( $t _ { 1 } < t _ { 2 }$ ) is

• A)Unknown until \(t _ { 1 }\)
• )
• B)Settled when we get to \(t _ { 2 }\)
• )
• C)Depends on the ytm of coupon bonds of maturities \(t _ { 1 }\)
• And
• \(t _ { 2 }\)
• )
• D)Depends on the ytm of zero-coupon bonds of maturities \(t _ { 1 }\)
• And
• \(t _ { 2 }\)
• )

---

Definitions:

Journal Entry

A record of the financial transactions of a business, documented in the general ledger accounts.

Issuance

Issuance refers to the process of making securities available for sale by a corporation or government entity, typically in the context of raising capital.

Interest Payment

A payment made to lenders by borrowers, representing the interest accrued on the loan or debt for a specific period.

Carrying Value

The book value of an asset on a company’s balance sheet, calculated as the original cost minus accumulated depreciation.