The real risk-free rate ( r) is 2.8% and is expected to remain constant. Inflation is expected to be 4% per year for each of the next two years thereafter. The maturity risk premium (MRP) is determined from the formula: 0.1(t1)%, where t is the security's maturity. The liquidity premium (LP) on all Sacramone Products Co.'s bonds is 0.55%. The following table shows the current relationship between bond ratings and defaul is required, use the arithmetic average. 5.25% 7.87% 8.42% 7.32% Based on your understanding of the determinants of interest rates, if everything else remains the same, which of the following will be true? Higher inflation expectations increase the nominal interest rate demanded by investors. The yield on U.S. Treasury securities always remains static