Question
At present, 10-year Treasury bonds are yielding 4.5% while a 10-year corporate bond is yielding 6.5%. If the liquidity-risk premium on the corporate bond is
At present, 10-year Treasury bonds are yielding 4.5% while a 10-year corporate bond is yielding 6.5%. If the liquidity-risk premium on the corporate bond is 0.7%,
what is the corporate bond's default-risk premium? Note that a Treasuty security should have no default-risk premium and liquidity-risk premium.
The corporate bond's default-risk premium is _% (round to one decimal place)
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Advanced Bond Portfolio Management
Authors: Frank J. Fabozzi, Lionel Martellini, Philippe Priaulet
1st Edition
0471678902, 9780471678908
