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Question 3 O out of 10 points Suppose 10-year T-bonds have a yield of 5.30% and 10-year corporate bonds yield 6.20%. Also, corporate bonds have
Question 3 O out of 10 points Suppose 10-year T-bonds have a yield of 5.30% and 10-year corporate bonds yield 6.20%. Also, corporate bonds have a 0.25% liquidity premium versus a zero liquidity premium for T-bonds, and the maturity risk premium on both Treasury and corporate 10-year bonds is 1.15%. What is the default risk premium on corporate bonds? Question 4 0 out of 10 points What is the present value of the following cash flow stream at a rate of 10.5%? Years:0 CFs $0 1 $1,500 $3,000 $4,500 $6,000
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