Question: 4. Problem 6.11 (Default Risk Premium) eBook yielding 5.35% per year, and the real risk-free rate (r*) is 2.40 % . The average yielding 9.3%

4. Problem 6.11 (Default Risk Premium) eBook yielding 5.35% per year,

4. Problem 6.11 (Default Risk Premium) eBook yielding 5.35% per year, and the real risk-free rate (r*) is 2.40 % . The average yielding 9.3% per year. Treasury bonds with the same maturity are A company's 5-year bonds are inflation premium is 2.55%, and the maturity risk premium is estimated to be 0.1 x (t 1)%, where t = number of years to maturity. If the liquidity premium is 1.3 %, what is the default risk premium on the corporate bonds? Round your answer to two decimal places. %

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