What is the risk free real rate of return


What is the risk free real rate of return?

1) You read in the Wall Street Journal that 30 day U.S. treasury bills are currently yielding 8%. Your brother in law, a broker, and a broker at Kyoto Securities, has given you the following estimates of current interest rate premiums:

Inflation premium = 5.0%
Liquidity premium = 1.0%
Maturity risk premium = 2.0%
Default risk premium = 2.0%

Based on the data, what is the risk free real rate of return?

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