10. Suppose that the risk-free zero curve is flat at 3.0% per annum with continuous compounding and that defaults can occur at times 0.25 years, 0.75 years, 1.25 years, and 1.75 years in a two-year plain vanilla credit default swap with semiannual payments. Suppose further that the recovery rate is constant at 28% and the unconditional probabilities of default (as seen at time zero) are 1.30% at time 0.25 years, 1.20% at time 0.75 years, 1.10% at time 1.25 years, and 1.10% at time 1.75 years. 1. (a) Model this CDS and calculate the required credit default swap spread. 2. (b) What would the calculated credit default spread be if the instrument was a binary credit default swap instead?