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Given the following historical average returns on different US investments, tell me the historical risk premium on US long-term corporate bonds. Small Stocks 11.9% Large

Given the following historical average returns on different US investments, tell me the historical risk premium on US long-term corporate bonds.

Small Stocks 11.9%

Large Stocks 9.8%

High-Yield Corp. Bonds 6.8%

L-T Corp. Bonds 5.9%

L-T Govt. Bonds 5.4%

Municipal Bonds 4.4%

U.S. Treasury Bills 3.7%

Inflation 3.0%

Choose the correct answer:

A.

1.1%

B.

2.1%

C.

2.2%

D.

5.1%

E.

6.0%

F.

6.1%

G.

6.5%

H.

6.8%

I.

7.5%

J.

8.2%

K.

8.9%

L.

No, none of the above is correct.

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