Suppose R1 = 2-year zero-coupon riskless rate, R2 = 10-year zero-coupon riskless rate, and RF is the implied forward rate from 2 to 10 years.At present, R2> R1.(A) You expect the term premium (defined as TP = (R2-R1) toshrinkin three months because of an expected increase in R1. Should you buy or sell theimplied forward rateinstrument to profit from the expected decline in TP? Why? (B) Suppose you expect the term premium turnnegativein three months (i.e., the yield curve wouldinvert) because of an expected sharp increase in R1. Discuss an active investment strategy that involvestrading R1 and R2to profit from the expected yield curve inversion?