1. (Inflation and interest rates) What would you expect the nominal rate of interest to be if the real rate is 3.6 percent and the expected inflation rate is 6.6 percent? The nominal rate of interest is nothing%. ?(Round to two decimal places.)
2. (Calculating the maturity-risk premium) At present, the real risk-free rate of interest is 1.9%, while inflation is expected to be 1.8% for the next two years. If a 2-year Treasury note yields 4.7%, what is the maturity-risk premium for this 2-year Treasury note?