The real risk-free rate is 3.55%, inflation is expected to be 2.55% this year, and the maturity

Question:

The real risk-free rate is 3.55%, inflation is expected to be 2.55% this year, and the risk premium is zero. Taking account of the cross-product term, i.e., not ignoring it, what is the equilibrium rate of return on a 1-year Treasury bond?
a. 5.595%
b. 5.757%
c. 6.376%
d. 6.191%
e. 5.138%

Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...