Assume we have four bonds, each with a 10% probability of defaulting over the next year. The event…

Assume we have four bonds, each with a 10% probability of defaulting over the next year. The event of default for any given bond is independent of the other bonds defaulting. What is the probability that zero, one, two, three, or all of the bonds default? What is the mean number of defaults? The standard deviation?

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