QUESTION 4 Consider the effect of an un-anticipated 1 basis point increase in the 5 year bond rate (xt) at time t, which persists at t+1, +2.... Assuming the 2 year band rate (zt) does not change, and no other shocks occur at any horizon, what is the most appropriate inference regarding the change in the 10 year bond rate (Yt) one month (t+1) after impact? 2. The 10 year bond rato increases by 1.515 one month after impact. b. The 10 year bond rate decreases by 0.0175 one month after impact. . The change in the 10 your bond rate one month after impact is between 1.4463 and 1.6847 with 95% confidence Od The change in the 10 year bond rate one month after impact is contained in a 95% confidence interval centred at -0.0175