Assume that r$*=1\mathrm{.}8\%$; the maturity risk premium is found as MR $=0\mathrm{.}1\%($t $-1),$ where t $=$ years to maturity; the default risk premium for corporate bonds in this case can be found as DRP $=0\mathrm{.}05\%($t $-1)$; the liquidity premium is $0\mathrm{.}75\%$ for corporate bonds only; and inflation is expected to be $2\%,2\mathrm{.}5\%,$ and $3\%$ during the next three years and then $4\%$ thereafter. What is the difference in interest rates between $10-$year corporate bonds and $10-$year Treasury bonds?

Group of answer choices

$1\mathrm{.}25\%$

$7\mathrm{.}35\%$

$1\mathrm{.}2\%$

$6\mathrm{.}15\%$