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Calculate the equilibrium CDS spread given the following parameters. Conditional year 1 default probability: 3% Conditional year 2 default probability: 9% Recovery rate given default:

Calculate the equilibrium CDS spread given the following parameters.

Conditional year 1 default probability: 3%

Conditional year 2 default probability: 9%

Recovery rate given default: 4%

Riskfree rate: 7%

Report your answer in percentage form.

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