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Consider a 1-year zero-coupon corporate bond Face value= $1,000 The probability of default is 20% If there is default, the bondholders will get $500 The

Consider a 1-year zero-coupon corporate bond

Face value= $1,000

The probability of default is 20%

If there is default, the bondholders will get $500

The 1-year risk-free rate is 5%

The risk premium for this bond is 2%

What is the bonds Promised YTMs?

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