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D Question 15 Crockett Corporation's 5-year bonds yield 8.85%, and 5-year T-bonds yield 6.85%. The real risk-free rate is r* = 4.35%, the default risk

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D Question 15 Crockett Corporation's 5-year bonds yield 8.85%, and 5-year T-bonds yield 6.85%. The real risk-free rate is r* = 4.35%, the default risk premium for Crockett's bonds is DRP = 0.75% versus zero for T-bonds, the liquidity premium on Crockett's bonds is LP= 1.25%, and the maturity risk premium for all bonds is found with the formula MRP= (t - 3) x 0.75%, where t = number of years to maturity. What is the inflation premium (IP) on 5-year bonds? O 1.60% 2.00% 0 1.50% O 1.00% O 1.30%

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