Question: please write out formulas and the calculations clearly. IV. Compute the two-year nominal interest rate using the exact formula and the approximation formula for each

please write out formulas and the calculations clearly. IV. Compute the

please write out formulas and the calculations clearly.

IV. Compute the two-year nominal interest rate using the exact formula and the approximation formula for each set of assumptions listed in (a) through (c). a. it = 2%; i+1 = 3% b. it = 2%;:{E+1 = 10% c. it = 2%; if\" = 3%. The term premium on atwoyear bond is 1%

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