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A 30-day T-bill is currently yielding 6.5%. The following information is available: inflation premium = 4.0%, liquidity premium = 0.6%, maturity risk premium = 1.8%
A 30-day T-bill is currently yielding 6.5%. The following information is available: inflation premium = 4.0%, liquidity premium = 0.6%, maturity risk premium = 1.8% and default risk premium = 2.15%. On the basis of these data, the nominal risk-free rate is ____________ and the real risk-free rate is _________________.
Select one:
a. 2.5%; 5.5%
b. 5.5%; 1.9%
c. 6.5%; 2.5%
d. 5.5%; 2.5%
e. 1.5%; 3.0%
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