1. One-year Treasury bills currently earn 1.20 percent. You expect that one year from now, 1-year Treasury bill rates will increase to 1.40 percent. If the unbiased expectations theory is correct, what should the current rate be on 2-year Treasury securities? (Round your answer to 2 decimal places.) Current rate % __________

2. Suppose that LilyMac Photography has annual sales of $237,000, cost of goods sold of $172,000, average inventories of $5,200, average accounts receivable of $26,400, and an average accounts payable balance of $7,700. Assuming that all of LilyMac’s sales are on credit, what will be the firm’s cash cycle? (Use 365 days a year. Do not round intermediate calculations. Round your final answer to 2 decimal places.) Cash cycle________ days