1. The real risk free rate of return is currently 1.5%.Inflation is expected to be 2% the next two years and 3% the following year.If the Maturity Risk Premium is .5% what is the yield on a 3 year treasury security?(be sure to show your calculation)

2. Delta Corporation bond pays an annual coupon rate of 7% with 4 years remaining until maturity. The par value of the bond is $1,000. Determine the current market value of the bond if the yield to maturity is 8%. (Be sure to indicate your inputs to the financial calculator)

N I/YR PV PMT FV