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Risk-free rate and risk premiums The real rate of interest is currently 3%; the inflation expectation and risk premiums for a security are shown below.

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Risk-free rate and risk premiums The real rate of interest is currently 3%; the inflation expectation and risk premiums for a security are shown below. a. Find the risk-free rate of interest, RF, that is applicable to the security. b. Find the nominal rate of interest for the security. a. The risk-free rate of interest, RF, that is applicable to the security is %. (Round to the nearest whole percent.) b. The nominal rate of interest for the security is \%. (Round to the nearest whole percent.)

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