Question: The table below shows current and expected futureone-year interestrates, as well as current interest rates on multiyear bonds. Use the table to calculate the liquidity

The table below shows current and expected futureone-year interestrates, as well as current interest rates on multiyear bonds. Use the table to calculate the liquidity premium for each multiyear bond.

Year One-Year Bond Rate Multiyear Bond Rate

1 2.00% 2.00%

2 5.00% 4.00%

3 6.00% 7.00%

4 9.00% 8.00%

5 10.00% 10.00%

The liquidity premiums for each year are givenas: (Enter your responses rounded to two decimalplaces.)

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