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The liquidity premium is 0.2% per year, the maturity premium is 0.7% per year, the real risk-free rate is 2.3% per year, and the default
The liquidity premium is 0.2% per year, the maturity premium is 0.7% per year, the real risk-free rate is 2.3% per year, and the default premium is 2.5% per year. If the risk-free interest rate is 3.4% per year, what is the approximation of annual inflation premium? 1) 2.3% 2) 1.1% 3) 2.1% O4) 1.6% 5) 1.9%
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