Shipley Corporation's 5-year bonds yield 6.00% and 5-year T-bonds yield 3.90%. The real risk-free rate is r* = 2.0%, the inflation premium for 5-year bonds is IP = 1.50%, the liquidity premium for Shipleys bonds is LP = 0.4% versus zero for T-bonds, and the maturity risk premium for all bonds is found with the formula MRP = (t 1) 0.1%, where t = number of years to maturity. What is the default risk premium (DRP) on Shipleys bonds?

a. 1.50% b. 1.70% c. 1.80% d. 1.90% e. 2.00%