You are given the following information:

Current interest rate on a 4 year T-bond (₁R₄) = 5.0%

Expected interest rate on a 1 year T-bond 1 year from today (₂f₁) = 2.0 %

Expected interest rate on a 1 year T-bond 2 years from today (₃f₁) = 3.25%

Expected interest rate on a 1 year T-bond 3 years from today (₄f₁) = 4.00%

Required liquidity risk premia for a:

1-year bond (l₁) = 0% 2-year bond (l₂) = 0.10% 3-year bond (l₃) = 0.25% 4-year bond (l₄) = 0.30%

If the Liquidity Premium Theory of the term structure of interest rates holds, what is the current 2-year rate (₁R₂)? (Use geometric average.)

Please show all work. I'm genuinely confused on how to start this one.