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Title: Keys Corporations 7-year bonds yield 8%, and 7-year T-bonds yield 6.2%. The real risk-free rate is ... Post by: BigFella9503 on Aug 6, 2023 Keys Corporation’s 7-year bonds yield 8%, and 7-year T-bonds yield 6.2%. The real risk-free rate is r* = 3.6%, the inflation premium for 7-year bonds is IP = 2%, the liquidity premium for Keys’s bonds is LP = 0.9% versus zero for T-bonds, and the maturity risk premium for all bonds is found with the formula MRP = (t – 1)×0.1%, where t = number of years to maturity. What is the default risk premium (DRP) on Keys’s bonds? ▸ 0.5% ▸ 0.8% ▸ 0.9% ▸ 1.1% Title: Re: Keys Corporations 7-year bonds yield 8%, and 7-year T-bonds yield 6.2%. The real risk-free rate is ... Post by: moyo966 on Aug 6, 2023 Content hidden
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