A particular securitys equilibrium rate of return is 8, Finance Basics

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A particular securitys equilibrium rate of return is 8

Question - A particular security's equilibrium rate of return is 8 percent. For all securities, the inflation risk premium is 1.75 percent and the real interest rate is 3.5 percent. The security's liquidity risk premium is .25 percent and maturity risk premium is .85 percent. The security has no special covenants. Calculate the security's default risk premium.

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Finance Basics: A particular securitys equilibrium rate of return is 8

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Finance Basics: A particular securitys equilibrium rate of return is 8

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