Suppose the infiation rate is expected to be 5% next year, 4% the following year, and 2% thereafter. Assume that the real risk-free rate, r, wal remain at 1% and that maturity ris premlums on Treasury securities rive from zero on very short-term bonds (those that mature in a few days) to 0.24 for tyear secunities. Furthermore, maturity risk pcertiums increase 0.2% for each year to maturity, up to a limit of 1.0s on 5 -year or longer-term T-bends. a. Calculate the interest rate on 1=2,3+4+5,10% and 20 -year Treasury secunities. Round your answers to the decimal places. Select the cerrect yield curve based on these dats. b. Suppose a AAA-rated company (which is the highest bond rating a firm can have) had bonds with the same maturites as the Treasury benas. Eitimate what you believe a AA-rated company's yield curve would look like on the same graph with the Treasury bord yield curve. (Hint: Think about the defoul risk premium on its long.term. versus its short-term bonds.) The yield risk curve for the AAA-tated cerporate bonds will the yieid curve for the Treasury securitite. c. What will be the approximate yleid curve of a muth riskier kwwer-cated sompany with a much higher risk of defaultiog on its bonds? The yield risk curve of a much riskier lowerorated company will be rated corporate bonds. the yield curve for the Treasury securities and