What geometric average annual rate of interest would you


Given below are the yields to maturity on a 5-year bond:

Years to maturity

Yield to maturity

1

8.0

2

9.0

3

10.0

4

10.5

5

10.8

A. What is the implied forward rate of interest for the third year?

B. What (geometric) average annual rate of interest would you receive if you bought a bond at the beginning of the third year and sold it at the beginning of the fifth year?

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Financial Management: What geometric average annual rate of interest would you
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