Swap the forward prices on a barrel of crude oil are 43 and, Ask an Expert

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SWAP The forward prices on a barrel of crude oil are $43 and $45 in years one and two, respec- tively.

a. What is the likely two year swap price on a barrel of crude oil, if the interest rates on zero coupon government bonds are 4.0% and 4.5% in years one and two, respectively?

b. What is the likely two year swap price on a barrel of crude oil, if the 1- and 2-year interest rates on zero coupon government bonds are 4.0% and 4.5%, respectively?

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Financial Management, Finance

Category:- Financial Management
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