A particular security's equilibrium rate of return is 9 percent. For all securities, the inflation risk...

Transcribed Image Text:

A particular security's equilibrium rate of return is 9 percent. For all securities, the inflation risk premium is 3.25 percent and the real risk-free rate is 2.2 percent. The security's liquidity risk premium is 0.95 percent and maturity risk premium is 0.95 percent. The security has no special covenants. Calculate the security's default risk premium. (Round your percentage answer to 2 decimal places. (e.g., 32.16)) Default risk premium % The current one-year Treasury bill rate is 0.40 percent and the expected one-year rate 12 months from now is 1.10 percent. According to the unbiased expectations theory, what should be the current rate for a two-year Treasury security? (Do not round intermediate calculations. Round your percentage answer to 2 decimal places. (e.g., 32.16)) Current rate A particular security's equilibrium rate of return is 9 percent. For all securities, the inflation risk premium is 3.25 percent and the real risk-free rate is 2.2 percent. The security's liquidity risk premium is 0.95 percent and maturity risk premium is 0.95 percent. The security has no special covenants. Calculate the security's default risk premium. (Round your percentage answer to 2 decimal places. (e.g., 32.16)) Default risk premium % The current one-year Treasury bill rate is 0.40 percent and the expected one-year rate 12 months from now is 1.10 percent. According to the unbiased expectations theory, what should be the current rate for a two-year Treasury security? (Do not round intermediate calculations. Round your percentage answer to 2 decimal places. (e.g., 32.16)) Current rate