Question
You observe the following 1-year yields on a corporate and government bonds over the course of several days: Corp yield Govt Yield 3.5 1.9 3.11
You observe the following 1-year yields on a corporate and government bonds over the course of several days:
| Corp yield | Govt Yield |
| 3.5 | 1.9 |
| 3.11 | 1.42 |
| 3.93 | 1.37 |
| 3.44 | 1.51 |
| 3.48 | 1.63 |
What is your estimate of expected annual percentage loss on the risky bond?
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Quantitative Corporate Finance
Authors: John B. Guerard Jr. Anureet Saxena, Mustafa Gultekin
2nd Edition
3030435466, 978-3030435462
