Question: The 15 year Treasury bonds are yielding 4.75% while a 10 year AA rated corporate bond yields 7.25%. The maturity risk premium of this Treasury

The 15 year Treasury bonds are yielding 4.75% while a 10 year AA rated corporate bond yields 7.25%. The maturity risk premium of this Treasury Bond is 0.35%. If the liquidity premium and default risk premium on this corporate bond is 0.75% and 1.25% respectively, calculate its maturity risk premium. A. 0.85%. B. 0.15%. C. 0.5%. D. 0%.

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