Calculate the inflation premium

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Reference no: EM131815896

Projections for inflation for the next few years are as follows:

year 1 6%

year 2 5%

year 3 4%

a) Calculate (and show your work) the inflation premium for a 2-year bond?

b) Calculate (and show your work) the inflation premium for a bond maturing in 3 years?

Reference no: EM131815896

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