PLEASE SHOW ON EXCEL
The real risk-free rate of interest is 4%. Inflation is expected to be 2% this year and 4% during each of the next 2 years. Assume that the maturity risk premium is zero. What is the yield on 2-year Treasury securities? What is the yield on 3-year Treasury securities?
I can do this by hand, but I am wondering the easiest way to do it on excel. Should I use nominal function? Thanks!
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