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    A Treasury bond that matures in 10 years has a yield of 6%.

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    A Treasury bond that matures in 10 years has a yield of 6%. A 10 year corporate bond has a yield of 8%. Assume that the liquidity premium on the corporate bond is 0.5%. What is the default risk premium on the corporate bond?

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    The market rate of interest is equal to the risk-free rate of interest plus the risk premium. Treasury bonds are by ...

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    This solution discusses determining default risk of a treasury bond in 78 words.

    $2.19

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