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A corporate bond with 10 years to maturity yields 6.4%, while Treasury notes of the same maturity yield 2.4%. The corporate bond has a liquidity

A corporate bond with 10 years to maturity yields 6.4%, while Treasury notes of the same maturity yield 2.4%. The corporate bond has a liquidity premium of 1.3%. Attempt 1/5 for 10 pts.

Part 1

What is the default risk premium on the corporate bond

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