The real risk-free rate of interest is 2 percent. Inflation is expected to be 4 percent this coming year, jump to 5 percent next year, and them remain at 3 percent. The MRP is .5%. What should the interest rate be on a 4 year Treasury Bond?

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The real risk-free rate of interest is 2 percent. Inflation is expected to be 4 percent this coming year, jump to 5 percent next year, and them remain at 3 percent. The MRP is .5%. What should the interest rate be on a 4 year Treasury Bond? TO RECEIVE CREDIT FOR THIS QUESTION YOU MUST SHOW BOTH YOUR ANSWER, ROUNDED TO TWO DECIMAL PLACES, AND THE CALCULATIONS YOU USED TO ARRIVE AT THAT