BAII Plus Pro steps to calculate the different r's in an interest rate tree

CFA Level II Fixed Income
#1

What are steps to calculate the different r’s on the BAII Plus Pro?

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I punch .2>2nd>LN and get 1.221403. After that I’m flummoxed.

#2

I do this all the time also; you’ll want to multiply the volatility, .2, by 2, and then get the exp of that (exp(.2*2)). Then multiply that value, 1.491825, by the lower node rate of 6.2% to get 9.249313%.

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#3

Excellent explanation!

#4

New problem:

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Now why was 7.7099% in the numerator and not used for multiplication?

1-year Forward rate in the binomial tree