The default risk premium on the corporate bond

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Reference no: EM132032458

A Treasury bond that matures in 10 years has a yield of 4%. A 10-year corporate bond has a yield of 7.75%.

Assume that the liquidity premium on the corporate bond is 0.4%. What is the default risk premium on the corporate bond? Round your answer to two decimal places.

Reference no: EM132032458

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