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10-year Treasury bonds yield 3.8%. The inflation premium (IP) is 1.2%, and the maturity risk premium (MRP) on 10-year T-bonds is 0.3%. There is no
10-year Treasury bonds yield 3.8%. The inflation premium (IP) is 1.2%, and the maturity risk premium (MRP) on 10-year T-bonds is 0.3%. There is no liquidity premium on these bonds. What is the real risk-free rate, r*?
3.52% | ||
2.30% | ||
2.00% | ||
3.20% | ||
3.87% |
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