The bond equivalent yields for U.S. Treasury and A-rated corporate bonds with maturities of 93 and 175 days are given below:

93 Days 175 Days Treasury strip 8.07% 8.11%

A-rated corporate 8.42 8.66 Spread 0.35 0.55

a. What are the implied forward rates for both an 82-day Treasury and an 82-day A-rated bond beginning in 93 days? Use daily compounding on a 365-day year basis.

b. What is the implied probability of default on A-rated bonds over the next 93 days? Over 175 days?

c. What is the implied default probability on an 82-day, A-rated bond to be issued in 93 days?