Question: Can someone help me solve this? You are considering on investment in 30-year bonds issued by Moore Corporation. The bonds have no special covenants. The

Can someone help me solve this?

You are considering on investment in 30-year bonds issued by Moore Corporation. The bonds have no special covenants. The Wall Street Joumal reports that 1-year T-bills are currently earning 1.90 percent. Your broker has determined the following information about economic activity and Moore Corporation bonds: Real risk-free rate =0.85% Default risk premium =1.80% Liquidity risk premiurn =1.05% Maturity risk premlum =2.40% a. What is the inflation premium? (Round your answer to 2 decimal places.) b. What is the fair interest rate on Moore Corporation 30-year bonds? (Round your answer to 2 decimal places.)

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