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Help Save & Exit You are considering an investment in 30-year bonds issued by a corporation. The bonds have no special covenants. The Wall Street

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Help Save & Exit You are considering an investment in 30-year bonds issued by a corporation. The bonds have no special covenants. The Wall Street Journal reports tha one-year T-bills are currently earning 3.50 percent. Your broker has determined the following Information about economic activity and the corporation bonds: Real Interest rate = 2.50 percent Default risk premium = 1.75 percent Liquidity risk premium 0.70 percent Maturity risk premium = 1.50 percent What is the inflation premium? What is the fair interest rate on the corporation's 30-year bonds? Multiple Choice 1 percent and 1.49 percent, respectively O 1 percent and 645 percent, respectively 1 percent and 7.45 percent, respectively 3.50 percent and 9.95 percent, respectively

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