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If a company has equity volatility of E = 40%, current market asset value of A0 = $70 million, current market equity value of E0

If a company has equity volatility of E = 40%, current market asset value of A0 = $70 million, current market equity value of E0 = $30 million and a zero-coupon bond to be paid in 5 years with a face value of F = $40 million, use the Merton Model to estimate the firm's probability of default for T=5.

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