The following data are gathered: · The real risk-free rate is 1.05% · Inflation premium is constant at 2.60% · Default risk premium is 3.50% · Maturity risk premium is 2.30% · Liquidity risk premium is 1.50% What is the risk free rate?
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The following data are gathered:
· The real risk-free rate is 1.05%
· Inflation premium is constant at 2.60%
· Default risk premium is 3.50%
· Maturity risk premium is 2.30%
· Liquidity risk premium is 1.50%
What is the risk free rate?
(Format: XX.XX%)
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- The following data are gathered:· The real risk-free rate is 1.05%· Inflation premium is constant at 2.60%· Default risk premium is 3.50%· Maturity risk premium is 2.30%· Liquidity risk premium is 1.50%What is the risk free rate?1. The return over the risk free rate of 3.4% A. Real return B. Average return C. Risk premium D. Required return E. Inflation premiumThe following data are gathered for: · The real risk-free rate is 1.25% · Inflation premium is constant at 2.50% · Default risk premium is 5% · Liquidity risk premium is 0.50% What is the quoted rate on a short-term government security? (Format: X.XX%)
- What is the market risk premium (rM - rRF)? Format: 1.1%Define each of the following terms:k. Inflation premium (IP); default risk premium (DRP); liquidity; liquiditypremium (LP)Based on Table 3, what is the liquidity risk premium? Table 3 Investment 1 2 3 4 5 O 1.25% O 1.50% O 0.25% O 1.12% Maturity 2 2 7 8 8 Liquidity High Low Low High Low Default Risk Low Low Low Low High Interest Rate 1.00% 1.25% 2.25% 2.93% 4.43%
- The actual interest paid or earned is commonly referred to as the: a. Risk premium. b. Annual effective interest rate. c. Nominal interest rate. d. Real rate of return.Capital Asset Pricing Model (CAPM) - Risk Free rate Risk free rate (Rf)* Beta (B)* 1.10 Market risk premium* 7.00% Expected return (ER) 10.20%The following data are gathered for:· The real risk-free rate is 1.25%· Inflation premium is constant at 2.50%· Default risk premium is 5%· Liquidity risk premium is 0.50% What is the quoted rate on a short-term government security?
- which one is correct please confirm? QUESTION 27 The term structure of interest rates is related to the ____ risk premium. a. seniority b. marketability c. default d. maturity8. Given the following information what must be the risk-free rate of interest (assume the asset is properly priced)? The expected return of the market is 14.25%, the stock's B is.82 and the expected return of the asset is 12.89%. A.5.91% B. 6.69% C. 7.41% D. 8.93%Calculate a security’s default risk premium where the equilibrium rate of return is 8 percent, the inflation risk premium is 1.25 percent, the real risk-free rate is 3.5 percent, the liquidity risk premium is 0.35 percent, and the maturity risk premium is 0.95 percent and there are no special covenants.