1. Suppose that the one-year interest rate over the next four years is expected to be 2%, 3%, 4% and 6%. a) Find the interest rate on a three- year bond. b) Find the interest rate on a four-year bond c) Find the interest rate on a four -year bond when the liquidity premium of the investor to hold a four-year bond is 2%.

anwers is

a)3 b) 3.75 c) 5.75 - how to get these answers