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Check my work Problem 6-1 Determinants of Interest Rates for Individual Securities (LG6-6) points Skipped A particular securi
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Answer #1

Equilibrium rate of return = default risk premium + inflation risk premium + real risk free rate + liquidity risk premium + maturity risk premium

= 3% + 2.80% + 1.70% + 0.20% + 0.80%

= 8.50%


Equilibrium rate of return = 8.50%

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