Compute the inflaction premium what is the fair interest


1) Use the following information to draw securities market line

return on the market=12%

risk fee rate of return = 3%

2) You considering an investment in 30 year bounds issued by moore corporation. the bound have no special covenants. the wall street Journal reports that one year T- bills are currently earning 3.25% your broker determined the following information about economic activity and moore corporation's bonds

- real risk free rate=2.25%

- default risk premium=1.15%

- liquidity risk premium=0.50%

Maturity risk premium= 1.75%

Compute the inflaction premium?

What is the fair interest rate on Moore corporation 30 year bounds?

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Financial Management: Compute the inflaction premium what is the fair interest
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