Swaps - CFA Curriculum Question - #4 pg 170 understand, discusses, question, studying, reading

OmarAdnan

Hey guys/gals,
Question on Swaps if anyone has mastered this.
Required reading #37, question #4 discusses the overpayment of a swap. The overpayment increases $0.952 x 1.070024.
I understand this conceptually, but what are the numbers used to arrive at the 1.070024?
Thanks and good luck studying!

Fdez

(1+r2)^2 / (1+r1)
r2 and r1 are provided…
standard methodology of finding the 1f2, 2f3 and so on we learned on Level I

NakedPuts00

indifference function : you are indifferent between buying and holding for 2 years , or buying for 1 year and rolling over another year

cfa10yrplan

Fantastic, thanks!