The liquidity premium on the corporate bond

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Reference no: EM131047532

A Treasury bond that matures in 8 years has a yield of 3.24%. A 8-year corporate bond has a yield of 7.8%. Assume that the liquidity premium on the corporate bond is 0.36%. What is the default risk premium on the corporate bond? State you answer as a percentage to 2 decimal places.

Reference no: EM131047532

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