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What is the liquidity premium lp on niendorf bonds

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Niendorf corporations 5 year bonds yield 7.75% and 5-year t-bonds yield 4.80%. The real risk free rate is r*= 2.75% the inflation premium for 5-year bonds is IP=1.65% the default risk premium for niendorf's bonds in DRP=1.20% versus zero for T-bonds and the maturity risk premium for all bonds is found with the formula MRP= (t-1) x 0.1% where t= number of years to maturity what is the liquidity premium LP on Niendorf's bonds.

Reference no: EM131693519

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