7. A gap put option with a strike price of 80 when STS 90 costs 1. What will be the payoff and the profit to the long position when St = 83.00? Payoff Profit a. -3 -4 b. O -1 c. 3 4 d. O 1 e. None of the above 8. Corporate bonds, issued by Arch Stanton plc, yield 4.3% and the risk-free rate of interest is 1.4%. If the loss given default is 40%, what is the default intensity or hazard rate for Arch Stanton plc? a. 0.048333 b. 0.0725 c. 0.1425 d. 0.095 e. None of the above