Question: At present, 10-year Treasury bonds are yielding 44% while a 10-year corporate bond is yielding 6.86.8%. If the liquidity-risk premium on the corporate bond is

At present, 10-year Treasury bonds are yielding

44%

while a 10-year corporate bond is yielding

6.86.8%.

If the liquidity-risk premium on the corporate bond is

0.40.4%,

what is the corporate bond's default-risk premium? Note that a Treasuty security should have no default-risk premium and liquidity-risk premium.

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