The real rate of interest is $1\%$ and expected to stay constant.

The table below shows information for two bonds:

Part $1$

What is the risk$-$free rate for an investment over $10$ years?

Part $2$

Attempt $\frac{1}{3}$ for $10$ pts$.$

What is the risk$-$free rate for an investment over $20$ years?

Part $3$

What is the nominal interest rate $($or yield to maturity$)$ for bond

A$?$

Part $4$

What is the nominal interest rate $($or yield to maturity$)$ for bond

B$?$

Part $5$

Based only on the information provided, do you expect the

yield curve to be

impossible to tell from the

data?

downward sloping, or

flat,

upward sloping,