Question: The problem is that I dont know what he means by simplest form of market interest rate I dont know if to include or exclude

The problem is that I dont know what he means by simplest form of market interest rate I dont know if to include or exclude default risk premium. Thank you!

17. If you expect the inflation premium to be 3%, the default risk premium to be 5% and the real interest rate to be 2%, what interest would you expect to observe in the marketplace under the simplest form of market interest rates? A) 5% B) 7% C) 8% 7% ? D) 1090 -10

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