The real risk-free rate (r astir) is 2.8 percentage and is expected to remain constant. Inflation is expected to be 4 percentage per year for each of the next three years and 3 percentage thereafter. The maturity risk premium (MRP) is determined from the formula: 0.1(t - 1) percentage, where t is the security's maturity. The liquidity premium (LP) on all Tahoe Hydroponics's bonds is 0.55 percentage. The following table shows the current relationship between bond ratings and default risk premiums (DRP): Tahoe Hydroponics issues nine-year, AA-rated bonds. What is the yield on one of these bonds? Disregard cross-product terms; that is, if averaging is required, use the arithmetic average. 8.28 percentage 7.73 percentage 4.95 percentage 7.48 percentage Based on your understanding of the determinants of interest rates, if everything else remains the same, which of the following will be true? The yield on a AAA-rated bond will be higher than the yield on a BB-rated bond. The yield on a AAA-rated bond will be lower than the yield on a AA-rated bond