1.The following is a schedule of historical defaults (yearly and cumulative) experienced by an FI manager on a portfolio of business and mortgage loans.

Complete the blank spaces in the table.
What are the probabilities that each type of loan will not be in default after five years?
What is the measured difference between the cumulative default (mortality) rates for business and mortgage loans after four years? LO 10.10

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Loan type Business: 1 year 2 years Years after issuance 3 years 4 years 5 years