Question: If the implied default probability on a 1-year credit default swap is 39.35%, and the swap spread is 750 bps. what is the recovery rate?

If the implied default probability on a 1-year credit default swap is 39.35%, and the swap spread is 750 bps. what is the recovery rate? (a) 14.37%; (b) 9.52%; (c) 29.47%; (d) 38.27%

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