Determine the real risk-free rate of return

Reference no: EM1366638

You read in the Wall Street Journal that thirty day T-bills are currently yielding 5.55. your brother-in-law, a broker at Safe and Sound Securities, has given you following estimates of current interest rate premiums;
Inflation premium=3.25%
Liquidity premium=0.6%
Maturity risk premium=1.8%
Default risk premium=2.15%

On the basis of these data, determine the real risk-free rate of return?

Reference no: EM1366638

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