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pls answer Q1 part a and part b You are considering an investment in 30-year bonds issued by Moore Corporation. The bonds have no special

pls answer Q1 part a and part b image text in transcribed
You are considering an investment in 30-year bonds issued by Moore Corporation. The bonds have no special covenants. The Wall Street Journal reports that 1-year T-bills are currently earning 1.30 percent. Your broker has determined the following information about economic activity and Moore Corporation bonds: Real risk-free rate =0.70% Default risk premium =1.20% Liquidity risk premium =0.60% Maturity risk premium =1.80% a. What is the inflation premium? (Round your answer to 2 decimal places.) b. What is the fair interest rate on Moore Corporation 30-year bonds? (Round your answer to 2 decimal places.)

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