Please answer the questions below: For questions 1 -3 no more than 6 sentences each. 4 a) and b) please show work so I can further understand how to do this. Thank you.
- Using the chart Below, describe what Monetary Policy the FED took from one year ago to one month ago and today if these yield curves are the result of that FED policy
- Explain below the relationship in general between the target FED FUNDS rate and the Money Supply growth form April 1999 until April 2009:
- Given these current rates, calculate the forward (FWD) rates for a one-year rate 1-year and 2-years from now:
- A) Given these current rates, calculate the forward (FWD) rates for a one-year rate 1-year and 2-years from now:
Current Rates
20 July 2021 0.81% (today)
20 July 2022 1.08%
20 July 2023 1.37%
20 July 2024 1.82%
20 July 2025 2.28%
B) Given your calculated FWD rates and the current rate of 0.81%, what are the expected inflation premiums (EIP) for each period of these three years if the REAL RATE is defined as 2%:
2021-2022:
2022-2023:
2023-2024
- Why can the scale of the yield curve be deceiving?Week 2 Project 6010
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