Which of the following is NOT correct concerning forward rates?
A) Forward rates link the current spot rate over one holding period to the current spot rate over a longer holding period.
B) They apply to contracts made now but relating to a period forward in time.
C) The forward rate, in reality, is the interest rate specified on a one-year loan.
D) Forward rates involve contracts made now for a loan made one year from now and paid back two years from now.
Correct Answer:
Verified
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