5, (10 points) Assume y = 1.5%, and also assume that the one-period spot rate next period can take the following two values with equal probability: y = 1.75% + 0 = 1.75% + 0.5% and y= 1.75% - 0 = 1.75% 0.5% . If Local Expectations Theory holds, calculate Y2, E(y^), and fi1. 5, (10 points) Assume y = 1.5%, and also assume that the one-period spot rate next period can take the following two values with equal probability: y = 1.75% + 0 = 1.75% + 0.5% and y= 1.75% - 0 = 1.75% 0.5% . If Local Expectations Theory holds, calculate Y2, E(y^), and fi1