1. Use the supply and demand model for bonds developed in Module 3 to analyze the effect of an increase in expected inflation on the price of bonds and the interest rate. Please see Chapter 3 of the textbook and watch the videos for help. 2. Use the supply and demand model for loanable funds developed in Module 3 to analyze the effect of a government budget deficit on the interest rate. Please see Chapter 3 of the textbook and watch the videos for help. 3. Assume that you own a 10-year, $10,000 US Treasury bond with a coupon rate of 3%. There are two years left to maturity, and you are planning to sell the bond in the secondary market. If the interest rate is 5%, how much can you expect to get for the bond? Please show your work
