You are considering purchasing a bond that matures in 6 years and has a coupon rate of 7%, paid annually. The bond is issued by a U.S. corporation.

Currently the real risk-free rate is 1.25%. Inflation is expected to be 2.5% annually for the foreseeable future.

You require this A-rated bond to have a credit risk premium of 0.75% and a liquidity premium of 0.25%. The maturity risk premium for bonds maturing in 6 years is 3.25%. What is your required return on this bond?