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8. Now consider the Lender's Risk Hypothesis. Say that you see a one-year loan for 20% and you know that lenders pay 10% for their

8. Now consider the Lender's Risk Hypothesis. Say that you see a one-year loan for 20% and you know that lenders pay 10% for their funds (that they in turn lend to borrowers). What probability of default are they expecting?

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