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Maturity the bond will default and you will receive

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Reference no: EM132354623

You own a 5% bond maturing in two years and priced at 87%. Suppose that there is a 10% chance that at maturity the bond will default and you will receive only 40% of the promised payment.

  • What is the bond's promised yield to maturity?
  • What is its expected yield?

Reference no: EM132354623

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