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The real rate of interest is currently 3%; the inflation expectation and risk premiums for a number of securities follow: INFLATION EXPECTATION Security Premium Risk

The real rate of interest is currently 3%; the inflation expectation and risk premiums for a number of securities follow: INFLATION EXPECTATION Security Premium Risk Premium A 6% 3% B 9% 2% C 8% 2% D 5% 4% E 11% 1% a.) Find the risk-free rate of interest, RF, that is applicable to each security. b.) Although not noted, what factor must be the cause of the differing risk-free rate found in part a? c.) Find the nominal rate of interest for each security

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