Ask a New Question

A treasury bond that matures in 10 years has a yield of 6%. A 10 year corporate bond has a yield of 9%. assume that the liquidity premium on the corporate bond is 0.5%. What is the default risk premium on the corporate bond?

2 answers

njnjn09

2.5%

Ask a New Question or answer this question.

Similar Questions

Isabella buys a $1,000 bond that matures in 10 years (that is, she lends $1,000 to the U.S. Treasury for 10 years). The bond
1. 1 answer
Interest rate premiums A 5-year Treasury bond has a 5.2 percent yield. A 10-year Treasury bond yields 6.4 percent, and a 10-year
1. 1 answer
You purchase a bond for $875. It pays $60 a year (semiannual coupon is 3%),&the bond matures after 10 years. What is the yield
1. 2 answers
You purchase a bond for $875. It pays $60 a year (semiannual coupon is 3%),&the bond matures after 10 years. What is the yield
1. 0 answers

more similar questions