(a). What are the two key theoretical pillars underpinning the KMV approach to estimating Expected Default Frequency? Briefly explain how each of these was used to assist in the development of the KMV model. (13 marks) 3. (b) What are the advantages and disadvantages of the KMV approach compared with a more fundamental analysis perspective? (10 marks) (c) Which approach would you chose to adopt if you were managing a portfolio of international bonds and why? (10 marks) (a). What are the two key theoretical pillars underpinning the KMV approach to estimating Expected Default Frequency? Briefly explain how each of these was used to assist in the development of the KMV model. (13 marks) 3. (b) What are the advantages and disadvantages of the KMV approach compared with a more fundamental analysis perspective? (10 marks) (c) Which approach would you chose to adopt if you were managing a portfolio of international bonds and why? (10 marks)