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The real risk - free rate of interest is 3 % . Inflation is expected to be 5 % next year, 7 % the year

The real risk-free rate of interest is 3%. Inflation is expected to be 5% next year, 7% the year after that, then fall to and remain at 4% from then on. The maturity risk premium is 1.5%.20 year AAA rated corporate bonds currently have a 2% liquidity premium and a 1% default risk premium. What is the yield on 20-year Treasury Bond?

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