1. Calculate the following: a) real interest rate if expected inflation is 3% and nominal interest rate is 2%, b) real interest rate if nominal interest rate is 50% and expected inflation is 44% c)...

1. Calculate the following:
a) real interest rate if expected inflation is 3% and nominal interest rate is 2%,
b) real interest rate if nominal interest rate is 50% and expected inflation is 44%
c) nominal interest rate if expected deflation is -5% and real interest rate is 5%

2. You want to sell your bond that has a par value of ₱100,000 plus a 5 percent annual coupon rate that will mature after one year. The prevailing interest rate is 8%. Will you be able to sell your bond for ₱100,000 or higher? Explain