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If you could invest in a 10-year Inflation-Indexed (real) Icelandic government bond with a 1% yield-to-maturity or in a 10-year non-indexed (nominal) Icelandic government bond

If you could invest in a 10-year Inflation-Indexed (real) Icelandic government bond with a 1% yield-to-maturity or in a 10-year non-indexed (nominal) Icelandic government bond with a 5% yield-to-maturity.

How much inflation are investors expecting per year for the next 10 years according to that?

Group of answer choices

a- 5.00%

b-4.00%

c-6.00%

d-3.96%

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