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Suppose Kruger Industrial Smoothing's 5-year corporate bonds yield 8%. The real risk-free rate, (r*) is 2%. Inflation is expected to be 4% this year, 3.5%

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Suppose Kruger Industrial Smoothing's 5-year corporate bonds yield 8%. The real risk-free rate, (r*) is 2%. Inflation is expected to be 4% this year, 3.5% next year, and 2% per year thereafter. Kruger's maturity risk premium is calculated using the formula, MRP = 0.1%* (t - 1), where t = number of years to maturity. What is the yield on Kruger's 10-year bonds given the same liquidity risk and default risk premiums apply to both the 5 and 10-year bonds

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