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To solve this problem, we need to understand that the risk-free rate is composed of several components:

The nominal interest rate is typically calculated as the sum of the real rate of interest, the inflation premium, and the default risk premium:

\[
\text{Nominal Rate} = \text{Real Rate} + \text{Inflation Premium} + \text{Default Risk Premium}
\]

In this case, however, we want to find the risk-free rate, which is generally considered to be the sum of the real rate of interest and the inflation premium, without the default risk premium.

### Given:
- Real Rate of Interest = 0.5%
- Inflation Premium = 9.3%
- Default Risk = 3.6%

### Formula for the Risk-Free Rate:
\[
\text{Risk-Free Rate} = \text{Real Rate} + \text{Inflation Premium}
\]

### Calculation:
\[
\text{Risk-Free Rate} = 0.5\% + 9.3\% = 9.8\%
\]

Therefore, the risk-free rate is **9.8%**.

Would you like a more detailed explanation, or do you have any further questions?

### Follow-up Questions:
1. What is the difference between the nominal interest rate and the real interest rate?
2. How does inflation impact the risk-free rate?
3. What factors contribute to the default risk premium?
4. Why is the risk-free rate an important concept in finance?
5. How would the risk-free rate change if inflation expectations change?

**Tip:** Remember that the risk-free rate is a theoretical concept and usually refers to government bonds in stable economies.

What is the risk-free rate if the real rate of interest is 0.5%, the default risk is 3.6%, and the inflation premium is 9.3%?

Find the risk-free rate given a real interest rate of 0.5%, a default risk premium of 3.6%, and an inflation premium of 9.3%. This solution uses key financial concepts like interest rates, inflation, and risk-free calculations. Suitable for finance students and professionals.

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