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eBook A 5-year Treasury bond has a 5.0% yield. A 10-year Treasury bond yields 6.3%, and a 10-year corporate bond yields 9.5%. The market expects

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eBook A 5-year Treasury bond has a 5.0% yield. A 10-year Treasury bond yields 6.3%, and a 10-year corporate bond yields 9.5%. The market expects that inflation will average 1.7% over the next 10 years (IP: - 1.7%). Assume that there is no maturity risk premium (MRP) and that the annual real risk-free rato, will remain constant over the next 10 years. (Hint: Remember that the default risk premium and the liquidity premium are zero for Treasury securities ORP LP = 0.) A 5-year corporate bond has the same default risk premium and liquidity premium as the 10-year corporate bond described. What is the yield on this 5-year corporate bond? Round your answer to one decimal place

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