1. One-year Treasury bills currently earn 2.90 percent. You expect that one year from now, 1-year Treasury bill rates will increase to 3.10 percent and that two years from now, 1-year Treasury bill rates will increase to 3.60 percent. The liquidity premium on 2-year securities is 0.05 percent and on 3-year securities is 0.15 percent. If the liquidity premium theory is correct, what should the current rate be on 3-year Treasury securities? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

2. Compute the future value in year 8 of a $2,600 deposit in year 1 and another $2,100 deposit at the end of year 3 using a 10 percent interest rate. (Do not round intermediate calculations and round your final answer to 2 decimal places.)

3. What’s the present value of a $950 annuity payment over six years if interest rates are 10 percent? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

4. Compute the future value in year 8 of a $2,600 deposit in year 1 and another $2,100 deposit at the end of year 3 using a 10 percent interest rate. (Do not round intermediate calculations and round your final answer to 2 decimal places.)