Koy Corporation's 5-year bonds yield 8.00%, and 5-year T-bonds yield 5.15%. The real risk-free rate is r* = 3.0%, the inflation premium for 5-year bonds is IP = 1.75%, the liquidity premium for Koy's bonds is LP = 0.75% versus zero for T-bonds, and the maturity risk premium for all bonds is found with the formula MRP = (t - 1) 
0.1%, where t = number of years to maturity. What is the default risk premium (DRP) on Koy's bonds?
0.1%, where t = number of years to maturity. What is the default risk premium (DRP) on Koy's bonds?A. 2.16%
B. 2.10%
C. 2.12%
D. 2.48%
E. 2.18%
Answer: B
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