garp13-p2-8

Hi everyone, In this question I do not get to the term (1+r) = (1-PD)*(1+y) - (1-PD)*(FV/MV) Could you explain why you use the term behind the minus and how you get to the term? I would have solved it with the following term: (1+y)*(1-PD)+PD*RR = 1+r , where PD*RR is canceled out as RR is zero...