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Suppose a firm with a value of $60 million.5 has a bond outstanding with a face value of $50 million that matures in 2 years,

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Suppose a firm with a value of $60 million.5 has a bond outstanding with a face value of $50 million that matures in 2 years, the current interest rate is 6% and the volatility of the firm is 25% what is the probability that the firm will default on its debt if the expected return on the firm, u, is 30% ?what is the expected loss * ?given default 5) (5 ) 151600 21600 121600 1121600 Suppose a firm with a value of $60 million.5 has a bond outstanding with a face value of $50 million that matures in 2 years, the current interest rate is 6% and the volatility of the firm is 25% what is the probability that the firm will default on its debt if the expected return on the firm, u, is 30% ?what is the expected loss * ?given default 5) (5 ) 151600 21600 121600 1121600

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