1) You read in the wall street journal that 30 day US treasury bills are currently yielding 8%. your brother in law, a broker, 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, the risk free rate of return is what?