- CFA Exams
- CFA Exam: Level II 2021
- Study Session 12. Fixed Income (1)
- Reading 32. The Term Structure and Interest Rate Dynamics
- Subject 4. The Swap Curve (LIBOR Curve)
CFA Practice Question
Assume the following spot rates: r(1) = 6%, r(2) = 7%, r(3) = 8% and r(4) = 9%. What is the swap rate s(1)?
B. 6.5%
C. 7%
A. 6%
B. 6.5%
C. 7%
Correct Answer: A
Swap rates can be determined from spot rates. According to Equation 12 s(1) = r(10 = 6%.
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