 |
|
| Browse | Ask | Answer | Search | Join/Login |
|
|
||||
|
Topic: maturity risk premium
Assume that the real risk free rate, r*, is 3 percent an that inflation is expected to be 8 percent in year 1,5 percent in year 2, and 4 percent thereafter. Assume also that all treasury securities are highly liquid and free of default risk. If a 2 year and 5 year treasury notes both yield 10 percent, what is the difference in the maturity risk premium on the two notes: that is what is MRP1 minus MRP2?
|
||||
|
||||
|
You might want to check out the announcement on the following link.
https://www.askmehelpdesk.com/math-s...board-b-u.html |
||||
Not your question?
Ask your question
View similar questions
| Question Tools | Search this Question |
Add your answer here.
Check out some similar questions!
Default Risk Premium
[ 2 Answers ]
Can you tell me how to calculate the DRP on the Corporate bonds? Info that I have follows: 5 Year Treasury note 5% interest rate 5 year Corporate bond (high quality) 6% interest rate 5 Year Corporate Bond (low quality) 8% interest rate Thanks for the help! Kathy
Default risk premium
[ 5 Answers ]
What is the equation for calculating the default risk premium?
Yield to maturity
[ 1 Answers ]
A coworker of yours was discussing her investments with a broker. Your coworker was confused because she had purchased a 10% bond but the broker kept repeating that it had a 9% yield to maturity.
View more questions Search
|
