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The Yield on a Corporate Bond with a 20 Year

Question 103

Multiple Choice

The yield on a corporate bond with a 20 year maturity would include


A) only the real rate of interest and expected inflation.
B) the risk-free rate multiplied by 1+ default rate.
C) the risk-free rate plus a default risk premium, a liquidity risk premium and a maturity risk premium.
D) the real rate of interest, the expected inflation rate and a default risk premium.

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