Assume you have a 2/1 Adjustable Rate Mortgage.If the margin/spread is 2.0 percentage points over the 1 Year T-Bill Rate and has (i) an initial cap of a 1.25 percentage point change at the time of the first adjustment, (ii) an annual cap of a 1.0 percentage point adjustments thereafter, (iii) a maximum interest rate of 8.5% and (iv) a minimum interest rate of 3.75%, calculate your interest rate at the time of each adjustment using the following information (10 points):

(a) Initial Interest Rate = ____________% if the 1 Year T-Bill Rate is equal to 2.25% at the making of the loan.

(b) Year 2 Interest Rate = ____________% if the 1 Year T-Bill rate is equal to 1.75% at the time of the first anniversary date.

(c) Year 3 Interest Rate = ____________% if the 1 Year T-Bill rate is equal to 1.5% at the time of the second anniversary date.

(d) Year 4 Interest Rate = ____________% if the 1 Year T-Bill rate is equal to 3% at the time of the third anniversary date.

(e)Year 5 Interest Rate = ___________% if the 1 Year T-Bill rate is equal to 3.5% at the time of the fourth anniversary date.

(f)Year 6 Interest Rate = ___________% if the 1 Year T-Bill rate is equal to 4.25% at the time of the fifth anniversary date.

(g)Year 7 Interest Rate = ___________% if the 1 Year T-Bill rate is equal to 5.5% at the time of the sixth anniversary date.

(h)Year 8 Interest Rate = ___________% if the 1 Year T-Bill rate is equal to 6.75% at the time of the seventh anniversary date.

(i) Year 9 Interest Rate = ___________% if the 1 Year T-Bill rate is equal to 7.0% at the time of the eighth anniversary date.

(j)Year 10 Interest Rate = ___________% if the 1 Year T-Bill rate is equal to 6% at the time of the ninth anniversary date.