Question: PLEASE EXPLAIN ANSWER AND SHOW WORK SO I MAY UNDERSTAND. NO HANDWRITING PLEASE. I WILL GIVE THUMBS UP. THANK YOU. If a corporation begin to

PLEASE EXPLAIN ANSWER AND SHOW WORK SO I MAY UNDERSTAND. NO HANDWRITING PLEASE. I WILL GIVE THUMBS UP. THANK YOU.

If a corporation begin to suffer large losses, then the default risk on its bonds will --------- and the equilibrium interest rate on these bonds will ----------.

Increase, increase
Decrease, increase
Increase, decrease
Decrease, decrease

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