Suppose that the interest rate on a one year risk free bonds is 5 , and now a corporate bond is issued with a face value of 1,000, maturing in 1 year The payoff in the case that the company doesn't default is 1050 with probability 80 , and 20 for the default case where bond holders receive nothing...

a The price of the bond is 1018 and its promised yield is 8 This is calculated by taking the face va ...

Suppose that the interest rate on a one-year risk-free bonds is 5%, and now a corporate...

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Suppose that the interest rate on a one-year risk-free bonds is 5%, and now a corporate...

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