The real risk-free rate (r*) is 2.8% and is expected to remain constant Inflation is expected to be 6% per year for each of the next two years and 5% 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 ali BTR Warehousing's bonds is 1.05\%. The following table shows the current relationship between bond ratings and default risk premiums (DRP): BTR Warehousing issues fifteen-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. 6.05\% 9.78% 10.13% 11.18% Based on your understanding of the determinants of interest rates, if everything else remains the same, which of the following will be true? In theory, the yield on a bond with a longer maturity will be higher than the yield on a bond with a shorter maturity. The yield on U.5. Treasury securities always remains static