Question $5$

Treasury securities that mature in $6$ years currently have an interest rate of $8\mathrm{.}50$ percent. Inflation is expected to be $5$ percent in each of the next three years and $6$ percent each year thereafter. The maturity risk premium is estimated to be $0\mathrm{.}10\%(t-1),$ where $t$ is equal to the maturity of the bond $($i$.$e$.,$ the maturity risk premium of a one$-$year bond is zero$).$ The real risk$-$free rate is assumed to be constant over time. What iS the real risk$-$free rate