Examlex
When determining the cost of a manufactured product, the cost of lighting the factory would be classified as
Liquidity Risk Premium
The extra yield or return that investors demand for holding a security that may not be easily sold or converted into cash without a significant loss in value.
Maturity Risk Premium
The additional yield demanded by investors as compensation for the increased risk of holding a bond as it approaches its maturity date.
Inflation Rate
The rate at which the general level of prices for goods and services is rising, and, subsequently, the purchasing power of currency is falling.
Pure Rate
The interest rate exclusive of all other elements such as risk premium, inflation, or other costs often considered the real rate of interest with no adjustments.
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