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5-year Treasury bonds yield 5.4%. The inflation premium (IP) is 1.9%, and the maturity risk premium (MRP) on 5-year bonds is 0.4%. What is the

5-year Treasury bonds yield 5.4%. 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 answe r. a. 2.75% b. 2.05% c. 2.40% d. 3.10% e. 1.70%

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