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Ex. 2 Calculate the combined default risk for company A and B from a combined bond issue of A and B: Company Bond issue (mn)

Ex. 2
Calculate the combined default risk for company A and B from a combined bond issue of A and B:
Company Bond issue (mn) Default options
A 80 2%
B 115 3%
Which of the 2 company increased the most its default risk, A or B ? By how much ?

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