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There are three possible outcomes ( states of the world ) for a $ 1 0 0 million bond There are three possible outcomes (states
There are three possible outcomesstates of the world for a $ million bond
There are three possible outcomes (states Of the world) for a $100 million bond issued by Aggiebank: With 70% probability the bond will pay its promised 35% yield-to-maturity, with 20% probability the bond will partially default and the return will be -50%, and with 10% probability the bond will fully default and the return will be -100%. What is the asset's standard deviation? 48. a) 48.3% 49. b) 32.0% 50.c) 23.4% 51. d) 4.5% 52.e) Not enough information to calculate.
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