What are the expected future one year rates

Reference no: EM13296142

Suppose the zero rates for years 1, 2, 3, 4 and 5 are 3.0%, 3.5%, 4.0%, 4.5%, and 5.0%, respectively. Find the one year forward rates starting at the end of years 2, 3, 4 and 5. According to the expectations theory of the term structure, what are the expected future one year rates starting at the end of years 2, 3, 4 and 5?

Reference no: EM13296142

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