The yield to maturity on 1-year zero-coupon bonds is currently maturity coupon bond, paying coupons once per year with a coupon rate of 4%, the YTM on 2-year zeros is 5%, The Treasury plans to issue a 2-year 6.5%. The face value of the bond is $100. a. At what price will the bond sell? (Do not round intermediate calculations Round your answer to 2 decim b. What will the yield to maturity on the bond be? (Do not round intermediate calculations. Round your answer to 3 decimal places.) c. If the expectations theory of the yield curve is correct, what is the market expectation of the price that the bond will sell for next year? Note from Ville: Under the expectations hypothesis, the expected one-year rate one year from now the current forward rate for year 2. Calculate the forward rate and use it to calculate the expected price of the bond when it has one year until maturity. (Do not round intermediate calculations. Round your answer to 2 decimal places.) d. Recalculate your answer to (c) if you believe in the liquidity preference theory and you believe that the liquidity premium 2.5% Under the liquidity preference theory, the forward rate market expectation the premium in order to find the true market expectation. (Do not round intermediate calculations. Round your answer to 2 decimal places is y premium. You must deduct the