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You observe the following information: . nominal risk-free rate: 2.8% expected inflation rate: o Year 1: 1.7% o Year 2: 1.9% o Year 3: 2.2%
You observe the following information: . nominal risk-free rate: 2.8% expected inflation rate: o Year 1: 1.7% o Year 2: 1.9% o Year 3: 2.2% o Year 4: 2.4% Maturity Risk Premium: 0.12*(t - 1); t = years to maturity Liquidity Premium: 0.15% Default Premium: 0.4% . . . Estimate the yield on a 4 year corporate bond. O 4.34% O 3.71% O 3.18% O 5.76% Save Answer 10 points Save and Submit Save All Answers Click Save and Submit to save and submit. Click Save All Answers to save all answers. ENG 1:31 PM 9/13/2020
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