Suppose that the current 3-month Treasury bill rate is 3% and the inflation rate is 2%. The 30-year Treasury bond rate is 5% and the 30-year corporate bond rate is 8%. Assuming that the liquidity-risk premium is estimated at 3 basis points. What is the nominal interest rate?(Hint: Nominal interest rate = Real risk-free interest rate + Inflation premium + Default-risk premium + Maturity-risk premium + Liquidity-risk premium)

Select one:

A.7.03%

B.9.03%

C.10.03%

D.8.03%