Consider Two Firms with Hazard Rates $$\lambda _ { 1 } = 0.10$$

Multiple Choice

Consider two firms with hazard rates $$\lambda _ { 1 } = 0.10$$ and $$\lambda _ { 2 } = 0.05$$ .The correlation of their default times is zero.What is the approximate probability that both firms default within five years?

A) 5%
B) 9%
C) 13%
D) 17%