Question
A Treasury bond that matures in 10 years has a yield of 5.00%. A 10-year corporate bond has a yield of 7.75%. Assume that the
A Treasury bond that matures in 10 years has a yield of 5.00%. A 10-year corporate bond has a yield of 7.75%. Assume that the liquidity premium on the corporate bond is 0.70%. What is the default risk premium on the corporate bond? Round your answer to two decimal places.
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Guardians Of Finance
Authors: James R. Barth, Gerard Caprio, Ross Levine
1st Edition
0262526840, 978-0262526845
