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Author Question: Niendorf Corporations 5-year bonds yield 7.15%, and 5-year T-bonds yield 5%. The real risk-free rate ... (Read 95 times)

ega16

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on: Aug 7, 2023
Niendorf Corporation’s 5-year bonds yield 7.15%, and 5-year T-bonds yield 5%. The real risk-free rate is r* = 2.85%, the inflation premium for 5-year bonds is IP = 1.75%, the default risk premium for Niendorf’s bonds is DRP = 1.3% versus zero for T-bonds, and the maturity risk premium for all bonds is found with the formula MRP = (t – 1)×0.1%, where t = number of years to maturity. What is the liquidity premium (LP) on Niendorf’s bonds?

◦

0.85%


◦

0.95%


◦

1.00%


◦

1.20%

Financial Management: Theory and Practice ¦ Brigham, Ehrhardt, Gessaroli, Nason ¦ 4th Edition
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Marked as best answer by ega16 on Aug 7, 2023

my33251

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Reply #1 on: Aug 7, 2023
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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ega16

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Reply 2 on: Aug 7, 2023
Thanks for the timely response, appreciate it

FergA

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Reply 3 on: Yesterday
Great answer, keep it coming :)

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