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    Real risk-free rate of return

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    30-day T-bills are currently yielding 8 percent.
    Current interest rate premiums:

    Inflation premium: 5%
    Liquidity premium: 1%
    Maturity risk premium: 2%:
    Default risk premium: 2%

    Calculate the real risk-free rate of return.

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    https://brainmass.com/economics/risk-analysis/real-risk-free-rate-return-example-problem-53681

    Solution Preview

    30-day T-bills are currently yielding 8 percent.
    Current interest rate premiums:

    Inflation premium: 5%
    Liquidity premium: 1%
    Maturity risk premium: 2%:
    Default risk premium: 2%

    Calculate the real risk-free rate of ...

    Solution Summary

    The solution calculates the real risk-free rate of return using Inflation premium, Liquidity premium, Maturity risk premium, and Default risk premium.

    $2.49

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