Op corporation's 5-year bonds yield 6.50%, and t-bonds with the same maturity yield 4.40%. the default risk premium for kop's bonds is drp = 0.40%, the liquidity premium on kop's bonds is lp = 1.70% versus zero on t-bonds, the inflation premium (ip) is 1.50%, and the maturity risk premium (mrp) on 5-year bonds is 0.40%. what is the real risk-free rate, r*?
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