A. You have invested $1,000,000 in a certain firm's bonds. You estimate that the default probability of those bonds is 56%. Also, if default happens, you expect the recovery rate to be about 46%. What is your expected loss on this bond?

B. You have the following ratios for a firm you're analyzing:

• Working capital / total assets = 0.8
• Retained earnings / total assets = 0.5
• EBIT / total assets = 0.2
• market value of equity / book value of LT debt = 1.5
• sales / total assets = 0.2

Calculate the firm's Z-score. Enter your answer rounded to 2 decimals. For example, if your answer is 3.45678, just enter 3.46