You are given the following information on spot rates (i.e. zero coupon bonds) for different terms:

Term	Term (maturity) component (annually compounded)	Defaults per 1000	Recovery on default	Inflation
1	0.50%	20	80%	2%
5	2.00%	10	50%	2%
10	3.50%	5	40%	2%
20	4.00%	20	20%	2%
25	6.00%	25	0%	2%

1. Calculate the effective annual spot rate for each term including defaults and recovery.
2. Calculate the default component of the spot rate for each term.
3. Calculate the gross spot rate for each term including default and inflation
4. State which type of yield curve to the gross spot rates form, and explain why. If the 1 year term component was 2.5%, what type of yield curve would the gross spot rates form and why?