Question
You are considering an investment in 30-year bonds issued by Moore Corporation. The bonds have no special covenants. The Wall Street Journal reports that 1-year
You are considering an investment in 30-year bonds issued by Moore Corporation. The bonds have no special covenants. The Wall Street Journal reports that 1-year T-bills are currently earning 2.00 percent. Your broker has determined the following information about economic activity and Moore Corporation bonds:
Real risk-free rate = 0.60%
Default risk premium = 1.90%
Liquidity risk premium = 1.40%
Maturity risk premium = 2.50%
What is the inflation premium?
What is the fair interest rate on Moore Corporation 30-year bonds?
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Bitcoin A Game Theoretic Analysis
Authors: Micah Warren
1st Edition
3110772833, 978-3110772838
