5-year Treasury bonds yield 5.1%. The inflation premium (IP) is 1.9%, and the maturity risk premium (MRP) on 5-year bonds is 0.4%. What is the real risk-free rate, r*?

Select the correct answer.

a. 2.65%

b. 2.80%

c. 2.50%

d. 2.35%

e. 2.20%