PROBLEM 2: Rates of interest With his $100 today, Robert can spend it on polo shirts costing $25 each. He also has the option to invest the $100 in a risk-free government Treasury security that is expected to earn a 9% nominal rate of interest. It is forecasted that there will be a 5% rate of inflation over the coming year. Questions: a. How many polo shirts can Robert purchase today? b. How much money will Robert have at the end of 1 year if he forgoes purchasing the polo shirts today? c. How much would you expect the polo shirts to cost at the end of 1 year in light of the expected inflation? d. Use your findings in parts b and c to determine how many polo shirts (fractions are OK) Robert can purchase at the end of 1 year. In percentage terms, how many more or fewer polo shirts can he buy at the end of 1 year? e. What is Robert's real rate of return over the year? How is it related to the percentage change in his buying power found in part d? Explain