Assuming the liquidity premium theory of interest rates holds: You observe the following bonds trading in the market:

a 1-year zero priced at $912.23

a two-year 10% coupon bond trading at par of $10,000

Recent academic research suggests bond investors need an extra 25 basis points for every year they hold a bond beyond the first year. What is the one-year interest rate (expressed in % without the sign)?

Based on the prior information, what is the expected one-year rate for the second year? Don't forget to use the liquidity premium too.

If the liquidity premium is 0 basis points, what is the expected one year rate for the second year?