Question 17 2 pts A 3-year CD offers a 2% annual return with no reinvestment risk. A 1-year CD offers a 1.3% annual return with no reinvestment risk. You believe interest rates are going up and decide to invest your money in the 1-year CD, planning to reinvest in another CD, with a 2-year term, at maturity. What is the minimum annual return you need to earn on that 2- year CD such that you will have earned the same 3-year return after 3 years as the 3- year CD investment? [Select ] Assume annual compounding. Hint: (1+013) 1 (1+x)^2 = (1+.02)^3 Note: Bank CDs (certificate of deposits) are essentially zero coupon instruments. Question 17 2 pts A 3-year CD offers a 2% annual return with no reinvestment risk. A 1-year CD offers a 1.3% annual return with no reinvestment risk. You believe interest rates are going up and decide to invest your money in the 1-year CD, planning to reinvest in another CD, with a 2-year term, at maturity. What is the minimum annual return you need to earn on that 2- year CD such that you will bow ad the came 3-year return after 3 years as the 3- year CD investme [ Select ] Assume annual cd 1.65% Hint: (1+.013)^1 | 2.35% Note: Bank CDs (CC 3.00% tially zero coupon instruments. 3.45%