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chieh1003h chieh1003h
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A year ago
To raise funds for Gravina Island Bridge, the Government of Alaska issued bonds. The bonds have a face value of $1,000, 15 years to maturity and a 7% coupon rate (annual coupons with the first coupon due in one year). The bonds are priced to yield 10%. U.S. Government T-Bonds with a 7% (annual) coupon rate and 15 years to maturity currently yield 7%. What is the default risk premium applied to the Gravina Bridge Bonds? (Assume that the Gravina bonds have the same liquidity risk premium as the T-Bonds.)

▸ 1%

▸ 2%

▸ 3%

▸ 4%

▸ 5%
Textbook 
Corporate Finance Online

Corporate Finance Online


Edition: 2nd
Authors:
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biocbioc
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A year ago
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chieh1003h Author
wrote...

A year ago
Thanks for your help!!
Lawson1981
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Yesterday
Thanks
lierac00
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2 hours ago
Good timing, thanks!
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