Question
Default Risk Premium A Treasury bond that matures in 10 years has a yield of 5.75%. A 10-year corporate bond has a yield of 7.5%.
Default Risk Premium
A Treasury bond that matures in 10 years has a yield of 5.75%. A 10-year corporate bond has a yield of 7.5%. Assume that the liquidity premium on the corporate bond is 0.6%. What is the default risk premium on the corporate bond? Round your answer to two decimal places.
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Handbook Of The Equity Risk Premium
Authors: Rajnish Mehra
1st Edition
0444508996, 978-0444508997
