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The nominal, risk-free rate on T-bills recently is 4.18%. If the real rate of interest is 1.06%, what is the expected level of inflation? The expected level of inflation, IP, is % (Round to two decimal places.) a The YTMu for Troanuries with differing matunities (with each rate expressed as an arrunt rate) on a recent day were shown in the following table Use the information in the preceding table to calculate the inflation expectation for each maturity The inflation expectation for the 3-month Treasury security in % (Round to two decimal places) Maturity 3 months 6 months 2 years 3 years 5 years 10 years 30 years Yield 1.38% 1.56 2.94 2.75 3.94 4.34 5.15 Real rate of interest 0.83 % 0.83 0.83 0.86 0.83 0.83 0.83 Assume that the rate of inflation expected over the coming year is 3.3% Explain how a 1-year T-bil have could com a negative real rate of retum over the next year. How could have had a zero real wie of return? What minimum rate of return musta T-billeam to meet your requirement of a 20% real rate of reum? How could a T-bill have had a negative real rate of retum over the same period? (Select the best answer below) WA AT-bill cannot experience a negative real retum OBAT bill can experience a negative real return of interest rate is greater than the inflation rate as measured by the CPU OC. AT.bill can experience a negative al retum i te interest rate in less than the waton rate as measured by the CPI You have two assets and must calculate their values today based on their payment streams and required rolume Asset has a required return of 8% and will produce a stream of 5700 starting at year and continuing indefinitely Asset 2 has a required return of 12% and will produce an end of year cash flow of $1,200 in 1 year $1,700 in 2 years and 5900 in 3 years The value of net today is $(Round to the nearest omnt.) A bond with 10 years to maturity and a coupon rate of 15% has a par, or face value of $22,000, Interest is paid annually. If you require a return of 16% on this bond, what is the price of the bond? The value of the bonds (Round to the nearest cent.)