The observed 5-year CDS spread for Country X is 800 basis po…

The observed 5-year CDS spread for Country X is 800 basis points (bps).a. Assuming a recovery rate of 40%, calculate the implied probability of default for Country X. Show your work.b. Now assume the recovery rate is 60% instead. Calculate the new implied probability of default. Show your work.c. Explain intuitively why the implied probability of default changes when the recovery rate changes.

A corn futures contract traded on the Chicago Board of Trade…

A corn futures contract traded on the Chicago Board of Trade has a contract size of 5,000 bushels.  An investor sells a corn futures contract when the futures price is $300 per bushel. The contract is closed out when the futures price is $340. Which of the following is true?