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Question 45 (4 points) U.S. Treasury Debt is currently paying 2.50 percent on an annual basis. High yield, i.e., junk, corporate bonds are currently paying
Question 45 (4 points) U.S. Treasury Debt is currently paying 2.50 percent on an annual basis. High yield, i.e., junk, corporate bonds are currently paying about 6.25 percent on an annual basis. You estimate an expected return on the market, i.e., the expected return on common stocks, to be 8.00 percent annually. Based on this information, what is the equity risk premium? 1) Between 0 percent and 5.00 percent 2) Between 5.01 percent and 9.00 percent 3) Between 9.01 percent and 13.00 percent 4) Greater than 13.00 percent
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