10) Consider the term structure of a 3 year discount bond. a. Write down the equation describing the interest rate it as a function of it, it and it +2 assuming no liquidity premium b. Suppose ist is 0.15 and it is 0.005. What is the average value of ic and int2"? c. Suppose the yield to maturity of the 3 year discount bond, ist, increases by Ais, but the yield to maturity on a one year bond is unchanged. What is the implied change in the expected one year yield assuming that the short term yield on the one year bond in period t+2 is unchanged? 10) Consider the term structure of a 3 year discount bond. a. Write down the equation describing the interest rate it as a function of it, it and it +2 assuming no liquidity premium b. Suppose ist is 0.15 and it is 0.005. What is the average value of ic and int2"? c. Suppose the yield to maturity of the 3 year discount bond, ist, increases by Ais, but the yield to maturity on a one year bond is unchanged. What is the implied change in the expected one year yield assuming that the short term yield on the one year bond in period t+2 is unchanged