You are given the following data:
r* = real risk-free rate = 4% Constant inflation premium = 7% Maturity risk premium = 1% Default risk premium for AAA bonds = 3% Liquidity premium for long-term T-bonds = 2% Assume that a highly liquid market does not exist for long-term T-bonds and the expected rate of inflation is a constant. Given these conditions, the nominal risk-free rate for 1 year T-bill is _________________, and the rate on long-term Treasury bonds is ___________________.

a. 4%: 14%
b. 4%; 15%
c. 11%; 14%
d. 11%; 15%
e. 11%; 17%