Based on Table 7, what is the default risk premium?
Investment | Maturity | Liquidity | Default Risk | Interest Rate |
1 | 2 | High | Low | 3.00% |
2 | 2 | Low | Low | 3.72 |
3 | 7 | Low | Low | 4.72 |
4 | 8 | High | Low | 5.54 |
5 | 8 | Low | High | 7.04 |
Table 7
A. 0.78%
B. 0.82%
C. 1.50%
D. 0.72%
Ans is A. 0.78%
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