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Suppose that the yield on a 1 year t-strip is 1.55% and the yield on a 2 year t-strip is 3.90%. The yield on a

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Suppose that the yield on a 1 year t-strip is 1.55% and the yield on a 2 year t-strip is 3.90%. The yield on a 1 year, zero coupon corporate bond is 5.80%, and the yield on a 2 year, zero coupon corporate bond is 10.30%. Use the information to answer the question. What is the probability of default for the corporate bond in year 1? 02.35% 04.02% 0 5.80% 39.74% Suppose that the yield on a 1 year t-strip is 1.55% and the yield on a 2 year t-strip is 3.90%. The yield on a 1 year, zero coupon corporate bond is 5.80%, and the yield on a 2 year, zero coupon corporate bond is 10.30%. Use the information to answer the question. What is the 1 year forward rate for the treasury securities? 0.10 0.40 102 1.06

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