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31. [Ch 7] JCNickel Corporation has issued zero-coupon corporate bonds with 7 years to
maturity and a face value of $2,000. Investors believe there is a 30% chance that JCNickel will
default on these bonds. If JCNickel does default, investors expect to receive only 40% of the
promised payoff at maturity. If investors' expected required return is 9.200%, what is the default
risk premium on these bonds? (to nearest 0.01% )

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