Suppose the spot rates for 1 and 2 years are S1 = 6.3% and S2 = 6.9% with annual compounding. Recall that in this course interest rates are always quoted on an annual basis unless otherwise specified. What is the forward rate f(1,2) assuming annual compounding?
I calculated it and the answer of mine is 7.5% but my professor said it's a wrong answer.
Would you mind to advise me how could I calculate it in the right way?