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( Interest rate determination ) If the10-year Treasury bond rate is 6.5 % 6.5%, the inflation premium is 2.3 % 2.3%, and thematurity-risk premium on10-year

(Interest rate determination) If the10-year Treasury bond rate is 6.5 %

6.5%, the inflation premium is 2.3 %

2.3%, and thematurity-risk premium on10-year Treasury bonds is 0.3 %

0.3%, assuming that there is noliquidity-risk premium on thesebonds, what is the realrisk-free interestrate?

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