Estimate the required rates of interest on the bond types

Assignment Help Financial Management

Reference no: EM131839815

Given the following information:

Real Risk-Free Rate 2.0%

Inflation Premium 3.0%

Default Risk Prem. 2.5%

Liquidity Risk Prem. 1.0%

Maturity Risk Prem. 1.5%

Estimate the required rates of interest on the bond types below

1. Long-term (30 yr) corporate bond

2. Long-term (30 yr) treasury bond

3. Short-term (30 day) corporate bond

Reference no: EM131839815

Questions Cloud

What is rebecca annual interest rate : What is Rebecca's annual interest rate

What is your total pre-tax return : What is the actual asking price for this bill, if its face value is $10,000? What is your total pre-tax return?

What is the implied annual effective interest rate : What is the implied annual effective interest rate if the replacement payment is accepted as equivalent to the original debt?

Companies to achieve competitive advantage : Why is it important for companies to achieve competitive advantage?

Estimate the required rates of interest on the bond types : Estimate the required rates of interest on the bond types below

Which of these portfolios is not on the efficient frontiers : Which of these portfolios is not on the efficient frontiers

Common views of compensation shared by employees : Identify and explain any common views of compensation shared by employees, employers, and society.

What is this person certainty equivalent for the prospect : What is the expected value of wealth? What is this person’s certainty equivalent for the prospect?

Research and development expenses grown as fast as sales : Does 3M have a lot of long-term debt? What are the chief ways in which 3M has financed assets? Has 3M’s research and development expenses grown as fast as sales

User Account

All Pages