Pleas answer both parts using the table, thank you.

3. Assume that the liquidity premium for all five years is given in the following table. Calculate the one-year interest rates in year 1, 2, 3, 4 and 5 based on the liquidity premium theory. 3 Year 1 2 3 4 5 Liquidity Premium 0% 0.5% 1% 1.5% 2% 4. What do you observe in the future short-term interest rates? How does this pattern imply the possibility of entering a recession