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Hi. This is from Principles of Managerial Finance, 14th edition. Chapter 6, warm up problem E6-5. Calculate the risk premium for each of the following
Hi. This is from Principles of Managerial Finance, 14th edition. Chapter 6, warm up problem E6-5. "Calculate the risk premium for each of the following rating classes of long-term securities, assuming that the yield to maturity (YTM) for comparable treasuries is 4.51%." Rating class 1. is AAA with a nominal interest rate of 5.12%. Rating class 2. is BBB with a nominal interest rate of 5.78% and rating class 3. is B with a nominal interest rate of 7.82%.
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