Problem 14. (8pt) Assuming that the expectations theory is the correct one of the term structure, calculate the interest rates in the term structure for maturities one to six years: 1. 4%, 4%, 5%, 6%, 6%, 6% 2. 5%, 5%, 4%, 4%, 4%, 4% (a) Explain what is happening to yield curve. (b) Assume that instead of the expectations theory, the liquidity premium theory takes place. What will be your answer to parts a and b, if the following liquidity premiums are expected? 0%; 0.25%, 0.5%, 0.75%, 1%, and 1.25% respectively