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Finance Question You read in The Wall Street Journal that 30-day T-bills are currently yielding 5.1%. Your brother-in-law, a broker at Safe and Sound Securities,

Finance Question

You read in The Wall Street Journal that 30-day T-bills are currently yielding 5.1%. Your brother-in-law, a broker at Safe and Sound Securities, has given you the following estimates of current interest rate premiums:

  • Inflation premium = 2.75%
  • Liquidity premium = 1.2%
  • Maturity risk premium = 1.70%
  • Default risk premium = 2.15%

On the basis of these data, what is the real risk-free rate of return? Round your answer to two decimal places.

= %

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