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2. The risk-free rate is 7% per year and a corporate bond yields 12% per year. Assuming a recovery rate of 65% on the corporate

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2. The risk-free rate is 7% per year and a corporate bond yields 12% per year. Assuming a recovery rate of 65% on the corporate bond, what is the approximate market-implied one-year probability of default of the corporate bond? (final answer) (3 Points) 0.14285 (14.29%)

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