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A corporations 20-year bonds have an equilibrium rate of

Question: A Corporation's 20-year bonds have an equilibrium rate of return is 10.00 percent. For all securities, the inflation risk premium is 1.63 percent and the real interest rate is 3.38 percent. The security's liquidity risk premium is .43 percent and maturity risk premium is .88 percent. The security has no special covenants. What is the bond's default risk premium?

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Accounting Basics: A corporations 20-year bonds have an equilibrium rate of

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