Recompute the example from the text, but assume now that the probability of receiving full payment in 1 year on a $200 investment of $210 is only 95%, the probability of receiving $100 is 1%, and the probability of receiving absolutely no payment is 4%.

(a) At the promised interest rate of 5%, what is the expected interest rate?

(b)What interest rate is required as a promise to ensure an expected interest rate of 5%?