Suppose that you buy a two-year 7.9% bond at its face value, answer the following: a-1. What will be your total nominal return over the two years if inflation is 2.9% in the first year and 4.9% in the second? a-2. What will be your total real return? b. Now suppose that the bond is a TIPS. What will be your total 2-year real and nominal returns? Complete this question by entering your answers in the tabs below. Required A Required B a-1. What will be your total nominal return over the two years if inflation is 2.9% in the first year and 4.9% in the second? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. a-2. What will be your total real return? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. a-1. Nominal return a-2. Real return % % Show less

Suppose that you buy a two-year 7.9% bond at its face value, answer the following: a-1. What will be your total nominal return over the two years if inflation is 2.9% in the first year and 4.9% in the second? a-2. What will be your total real return? b. Now suppose that the bond is a TIPS. What will be your tota/2-year real and nominal returns? Complete this question by entering your answers in the tabs below. a-1. What will be your total nominal return over the two years if inflation is 2.9% in the first year and 4.9% in the second? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. a-2. What will be your total real return? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Now suppose that the bond is a TIPS. What will be your total 2-year real and nominal returns? Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal pla