Risk free real rate of return

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Reference no: EM13115316

1) You read in the wall street journal that 30 day US treasury bills are currently yielding 8%. your brother in law, a broker, a broker at Kyoto Securities, has given you the following estimates of current interest rate premiums:

inflation premium = 5.0%

liquidity premium = 1.0%

maturity risk premium= 2.0%

default risk premium = 2.0%

Based on the data, the risk free rate of return is what?

Reference no: EM13115316

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