If you were to look at the yield curve, what nominal rate do you expect to see as the 3-year rate? Report your answer as an annual rate in decimal format and show four decimal places. For example, if your answer is 5.35% per year, enter .0535.

Year 1

Inflation Rate = 2%

Real Interest Rate=2%

Year 2

Inflation Rate = 5%

Real Interest Rate=4%

Year 3

Inflation Rate = 3%

Real Interest Rate=3%