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im confused on calculating default-risk premuim and maturity- risk premiums. like how does this formula work : NI= RI+IP+DP+ MP+LP and why are some excluded
im confused on calculating default-risk premuim and maturity- risk premiums. like how does this formula work : NI= RI+IP+DP+ MP+LP and why are some excluded when finding treasurey bonds or corporate bonds.if im giving the yield.... would that be the nominnal interest rate and if i am given two yields one from treasurey and another from corporate why do we ignore the treasury bond and solve for corporate instead ?
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