Chinotimba , CFA is a senior analyst in the fixed-income department of a large wealth management firm. Eustina is a junior analyst in the same department, and Talisa Anita is a member of the credit research team. The firm invests in a Bond 1. Chinotimba, CFA is presently analysing a set of bonds with some similar characteristics, such as four years until maturity and a par value of100. Exhibit 1 includes details of these bonds. Exhibit 1 A Brief Description of the Bonds Being Analysed B1 A zero-coupon, four-year corporate bond with a par value of 100. The wealth management firms research team has estimated that the risk-neutral probability of default for each date for the bond is 2%, and the recovery rate is 25%. Chinotimba, CFA asks Eustina to assist her with analysing the bonds. She wants him to per- form the analysis with the assumptions that there is no interest rate volatility and that the government bond yield curve is flat at 3%. a) In tabular form, compute the following: i) Exposure (4) ii) Recovery value (2) iii) Loss Given default (LGD) (2) iv) Probability of Loss (4) v) Probability of Survival (2) vi) Total Expected Loss (2) vii) Credit valuation adjustment (4) viii) Calculate the value of the risky if the bond (2) b) Define a Credit Default Swap (CDS) and explain its use in credit risk management.