CFAI Mock exam - Fixed income

[mblh123]

Hi all,
This is my first in Analyst Forum so lets see how it goes .
I have a confusion regarding Q51 in the CFAI mock, morning session
The question says:
[question removed by moderator]
Can someone explain why the correct choice is C?

 

[jlion1786]

It’s asking for the forward rate from what I remember
(1+foward)^3 x (1.04)^2 = (1.07)^5
This becomes
1+forward = ((1.07)^5 / (1.04) ^2)^1/3

 

[mblh123]

Thank you