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Please include steps with explanations and formulas. 4) There are two underlying assets in...

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Please include steps with explanations and formulas.

4) There are two underlying assets in an investment pool. Each has a 4% chance of defaulting. If an asset does not default it pays S1. If it defaults, it pays S0. These assets have some degree of correlation with each other. Financial engineers create a product that pays $1 if any of the two assets pays, O otherwise. Graph the probability of this asset paying as the correlation between the two underlying assets goes from 0 to 0.9. 4) There are two underlying assets in an investment pool. Each has a 4% chance of defaulting. If an asset does not default it pays S1. If it defaults, it pays S0. These assets have some degree of correlation with each other. Financial engineers create a product that pays $1 if any of the two assets pays, O otherwise. Graph the probability of this asset paying as the correlation between the two underlying assets goes from 0 to 0.9

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