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eBook A Treasury bond that matures in 10 years has a yield of 5.75%. A 10-year corporate bond has a yield of 7.50%. Assume that

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eBook A Treasury bond that matures in 10 years has a yield of 5.75%. A 10-year corporate bond has a yield of 7.50%. Assume that the liquidity premium on the corporate bond is 0.25%. What is the default risk premium on the corporate bond? Round your answer to two decimal places. % The real risk-free rate is 2.5% and inflation is expected to be 2.75% for the next 2 years. A 2-year Treasury security yields 5.75%. What is the maturity risk premium for the 2-year security? Round your answer to one decimal place. % The real risk-free rate is 1.75%. Inflation is expected to be 2.75% this year, 4.85% next year, and 2.4% thereafter. The maturity risk premium is estimated to be 0.05 (t-1)%, where t = number of years to maturity. What is the yield on a 7-year Treasury note? Do not round intermediate calculations. Round your answer to two decimal places. %

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