Calculate the risk premium for each of the following rating classes of long term securities, assuming that the yield to maturity (YTM) for comparable Treasuries is 4 51 Rating class Nominal interest rate AAA 5 12 BBB 5 78 B 7 82 ...

We calculate the risk premium of other securi ...

Calculate the risk premium for each of the following rating classes of long-term securities, assuming that the

Question:

Calculate the risk premium for each of the following rating classes of long-term securities, assuming that the yield to (YTM) for comparable Treasuries is 4.51%.
Rating class Nominal interest rate
AAA ............ 5.12%
BBB ............ 5.78
B ............ 7.82
Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...