Brazilian government bond

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The Brazilian government bond rate in nominal reais on January 1, 2019 was 16.51%. What will the risk-free rate in nominal reais be, if:

a. the Brazilian government bond, denominated in U.S. dollars, has a spread of 4.83% over the U.S. Treasury bond rate.

b. the CDS spread for Brazil, adjusted for the US CDS spread was 5.19%.

c. Brazil has a Baa3 local currency rating from Moody's. The default spread for a Baa3 rating is 2.44%.

Reference no: EM133069515

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