Rails 3: How to create a new nested resource?

The Getting Started Rails Guide kind of glosses over this part since it doesn't implement the "new" action of the Comments controller. In my application, I have a book model that has many chapters:

class Book < ActiveRecord::Base
  has_many :chapters
end

class Chapter < ActiveRecord::Base
  belongs_to :book
end

In my routes file:

resources :books do
  resources :chapters
end

Now I want to implement the "new" action of the Chapters controller:

class ChaptersController < ApplicationController
  respond_to :html, :xml, :json

  # /books/1/chapters/new
  def new
    @chapter = # this is where I'm stuck
    respond_with(@chapter)
  end

What is the right way to do this? Also, What should the view script (form) look like?