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An analyst evaluating securities has obtained the following information. The real rate of interest is 2.8% and is expected to remain constant for the next

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An analyst evaluating securities has obtained the following information. The real rate of interest is 2.8% and is expected to remain constant for the next 5 years. Inflation is expected to be 2.6% next year, 3.6% the following year, 4.6% the third year, and 5.6% every year thereafter. The maturity risk premium is estimated to be 0.1(t1)%, where t= number of years to maturity. The liquidity premium on relevant 5 -year securities is 0.5% and the default risk premium on relevant 5 -year securities is 1%. a. What is the yield on a 1-year T-bill? Do not round intermediate calculations. Round your answer to one decimal place. % Show All Feedback b. What is the yield on a 5-year T-bond? Do not round intermediate calculations. Round your answer to one decimal place. 8% Show All Feedback a c. What is the yield on a 5-year corporate bond? Do not round intermediate calculations. Round your answer to one decimal place. %

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