Does valuing a CDS using real-world default probabilities rather than risk-neutral default probabilities overstate or understate its value?

Answers

Answer 1

Valuing a credit default swap (CDS) using real-world default probabilities, as opposed to risk-neutral default probabilities, can potentially either overstate or understate its value, depending on the circumstances.

Valuing a CDS requires estimating the probability of default by the reference entity. Risk-neutral default probabilities are typically used in financial models as they reflect market expectations and take into account the risk premium associated with the credit risk.

If real-world default probabilities are higher than risk-neutral default probabilities, valuing a CDS using real-world probabilities may overstate its value since it would reflect a higher expected loss. Conversely, if real-world default probabilities are lower than risk-neutral default probabilities, valuing a CDS using real-world probabilities may understate its value as it would imply a lower expected loss.

To learn more about Probabilities : brainly.com/question/29381779

#SPJ11


Related Questions

Which of the following explains how revenue is determined?

A. The total amount of money brought in by sales.

B. Gross domestic product is calculated.

C. Costs are subtracted from revenues.

D. The maximum level of benefits is figured.​

Edit: Its not C

Answers

Answer:

A. The total amount of money brought in by sales.

5. Describe how Chris used networking to his advantage in getting an internship
Witter and signing new clients.

Answers

Answer:

is there more information for this question?

Question 2 (1 point)
Kelsi works in a toy manufacturing company assembling small dolls. Her job falls into
the Maintenance, Installation & Repair pathway of the Manufacturing career cluster.

1:) True

2:) False

Answers

True




I guess don’t be mad if I’m wrong

Which economic system is based on an idea of equality of result; that regardless of how well off somebody starts, all
should be guaranteed an equal success?
O A. Traditional
B. Command
OC. Mixed
D. Market

Answers

B. Command

What your describing sounds a lot like communism which would be found under a command economic system

Answer:

D.Market

Explanation:

A market economy conforms to formal equality of opportunity only if jobs offered by business firms are publicized in advance, so that anyone who might want to apply has a reasonable opportunity to do so.

How will taxation influence the circular flow model

Answers

Answer:

TMS

Explanation:

Taxes (T) imposed by the government reduced the flow of income.

Money paid to foreign companies for imports (M) also constitutes a leakage.

Savings (S) by businesses that would have been put to use are a decrease in the circular flow of an economy's income.

In what type of economy do people officials determine the 3 basic economic questions?

Answers

Most likely a Command economy.

Besides individuals, who else pays taxes in our country?

Answers

Answer:

Aliens?

Explanation:

FINISH THIS SENTANCE
There was this blind man, right? He Was feeling his way down the street with this stick,

Answers

when he runs into a old dog who so happens to be a dog that guides blind people.

A. Identify a profession b. In not more than 60 words, describe the "art" and "science" of such profession in (a).

Answers

Answer:

Comedy as a Profession is a great example.

Explanation:

The science of it is related to the psychology of what makes people laugh.

If studied, one would realize that there are certain things that are bound to make people laugh (all things being equal). An example is when a person makes fun of themself to an audience.

To explain this, scientists have stated that it is inherent in humans to laugh at the misfortune of others. However, this is just a theory and does not explain why we laugh at other kinds of comedy.

A plausible explanation (which is more recent in the parlance of psychology) is that people also laugh when certain expectations are defied in a very witty manner.

As a professional stand-up comedian, knowing all the rules and tricks is just one part of the coin. Being able to, either by practice or repeated efforts during practice, internalize these principles, practice them and effectively use them is the artistic part of the picture.

There those who are gifted naturally with a principle thought process that elicits laughter from others, would be termed hilarious. However, to make a living out of comedy, one would need to fully understand the principles and practice to deliver them as naturally as possible.

Another paradigm to the art of comedy is that, it has to be very witty. Wit many times may come with an element of suprise... a new angle that was previously "unthought" of.

Cheers!

List of the least five behaviors you feel would be behavior you feel would be considered irresponsible in the workplace. For each behavior listed, provide a detailed example/scenario to detail what makes the behavior either responsible or irresponsible.

Answers

Answer: See Explanation

Explanation:

Some of the behaviors that would be considered irresponsible in the workplace include:

1. Lateness: Every company has its working hours and it is required for the employees to adhere to the working hours and always get to work on time. Lateness is a bad habit in the workplace. For a company to achieve its goals, it's required for its workers to come to their workplace early and perform their duty well.

2. Cyberslackers: This occurs when the employees use the internet that is meant for work related activities to surf the net and browse sites that doesn't relate to their work. For example, a case whereby an employee is checking his or her social media at the workplace.

3. Lying to other employees: It is a bad behavior for an employee to lie or say something that's not true about a person in order to gain an advantage or for other person reasons Lying brings about lack of trust and disunity in the workplace.

4. Having a bad character: In an organization, it is vital for the employees to possess good characters such as being kind, caring, helpful etc. Possessing a bad character will have a negative effect on the company.

5. Theft: Employee theft is also an irresponsible behavior in the workplace. Stealing has a negative effect on the revenue of the company as it reduces the revenue such company makes. Employees should always make sure that they do not falsify information in order to gain a financial advantage or steal company's fund.

What are some common spreadsheets applications?​

Answers

USES ( APPLICATIONS) of spreadsheet are;

1) to create budgets : Excel can be used in creation of budget s which is the estimation of revenue as well as expenses which covers specified future period of time.

2)produce graphs and charts: it's application is helpful in creating graphs in mathematics as well as statistics

3 for storing and sorting data: Data sorting can be done using spreadsheet. It involves arrangements of data into an order in order to make analysis of the data easier.

SPREADSHEET APPLICATION

1)Microsoft Excel : This is used in data

crunching , it can handle large data sets.

2)LibreOffice : it's applicable in Calc for a free as well as native spreadsheet app.

4) Smartsheet: is useful when handling

task involving non-spreadsheet and can be used for project management.

5)Quip : it's useful for integration of

spreadsheets into shared documents.

Pete and Shirley are filing a joint return. They have two dependent children. What is the total amount of their exemptions for tax year 2019? A. $0 B. $4,200 C. $8,400 D. $16,800

Answers

Answer:

A. $0

Explanation:

The Tax Cuts and Jobs Act eliminated personal exemptions starting 2018. It also increased standard deductions though. For example, the standard deduction for married filing jointly for 2019 was $24,400. This is a significant increase if you consider that the standard deduction for married filing jointly in 2017 was $12,700.

Describe a situation where value at one level of the enterprise may not be seen as valuable at another level

Answers

Answer:

At the Board level of a traditional company, the value delivered by a company's Information technology unit is rarely mentioned or discussed if they are not an IT firm.

This is attributable to the inability of traditional firm-level economic analysis to bring fully to the fore, in a langugage that the Board of governors can understand, the intangible impacts of IT delivers to the overall business value.

The purchase of faster laptops and better productivity tools (for instance) which help to foster collaboration irrespective of time or space will in some way translate to increased bottom line due to increased effectiveness and efficiency might go unaccounted for or unnoticed in a board level report.

However, the sales-manager who brought in more money in sales will most likely get very decent attention from the powers that be.

Cheers

Place the steps for proper lifting technique in the correct order. --Select-- --Select-- --Select- --Select-- --Select- --Select-​

Answers

Answer:hold up

Explanation:

While using a debit card increases the speed and efficiency of business transactions, what effect can this have on a person's money management skills?

Answers

Often, using a debit card doesn’t feel like you are using real money, because it is so simple and efficient. This can cause people to buy more than they have in their checking account, often resulting in overdraft fees and poor budgeting.

The person can set his or her financial goal and this will result in preplanning the funds. This makes the platform an easy target to transact with and more efficient.

What is a financial goal?

A financial goal is an objective or plan for handling money. It is a function of how much money you make, spend, save, or invest. Depending on their need for a financial objective, such as pension planning, a person or individual might define their own financial goals.

The person who is a using debit card or a credit card. This would help the person in maintaining their efficiency and a budget. They can even set a limit through which they can be allowed to transit.

Also, they can use ODIs which is overdraft as well as bills receivable. This would increase their efficiency and money management.

Learn more about financial goal, here:

https://brainly.com/question/28302353

#SPJ2

Select all that apply.
Which of these are true of a natural pause following a conversation?
You should begin speaking to avoid awkwardness.
You should not panic.
Take a moment to collect your thoughts before you speak.
Conversations that end with a pause went poorly.

Answers

Answer: all of the above.

Why? Because all of them are important in a conversation!
speaking to avoid awkwardness is good so you won’t end up ruining the conversation without realizing and giving the other person a bad impression about yourself. And not panicking is quite important too, because when you panic and get negative thoughts you’ll realize that it’s keeping you down and making you feel bad or anxious about every single word you say. And lastly collecting your thoughts and putting them in order (few seconds before starting a conversation) can be helpful to most people which will make them feel more confident and prepare especially if the conversation was serious.

Answer:

You should not panic

AND

Take a moment to collect your thoughts before you speak.

Explanation:

Hope this helps!

DO you like Anne with an E?​

Answers

Answer:

meh

Explanation:

it's okay. I kind of don't like how they stayed from the book but all the scenes were shot beautifully, and the actors did great. I only watched a few so I cant give more than a "meh" but I do like what I'm seeing so far

HELP ME PLEASE!!!
when is it usually best to choose a variable rate home mortgage?
A. if you plan to stay there many years.
B. if you plan to stay there a short time before moving again.
C. if you plan to rent it out.
D. if you plan to have a large family.

Answers

Answer:

A...............maybe D

Prepare a report on environmental sanitation. Include the impacts, causes, and prevention methods​

Answers

Answer and Explanation:

Environmental sanitation is carried out through a series of public investments that seek to promote environmental control in a region. The impacts of this type of sanitation must be positive, since it is through it that a community can present adequate garbage collection, treated water supply, sewage treatment, correct disposal of human waste, cleaning of public roads, basic sanitation, among others . All of this promotes human development, the well-being of the population and environmental preservation.

The causes of environmental sanitation are the need to establish social policies that promote better living conditions and that optimize the health of citizens without degrading the environment.

If the country wants to move from its current point and produce 10 more tons of food, it must produce...

O 5 more tons of clothing

O 5 fewer tons of clothing

10 more tons of clothing

O 10 fewer tons of clothing

Answers

5 fewer tons of clothing

Workplace diversity describes differences among workers in any of the following areas:
salary
office space
religion
race
Select all that apply.

Answers

Answer:salary

All

Explanation:

Productivity is an important goal for Clearwater Electronics. Like most productive organizations, Clearwater recognizes the contributions human resource management (HRM) can make to improve productivity through people. How can HRM best ensure that the work environment at Clearwater is one in which employees are productive and add value?

Answers

Answer:

HR managers can contribute by providing work organization and design that allow for an increase of output as well as quality

Explanation:

what are vital events?

Answers

Answer:

efers to the live birth, death, foetal death, marriage, divorce, adoption, legitimation, recognition of parenthood, annulment of marriage, or legal separation.

Explanation:


Description
Vital statistics is accumulated data gathered on live births, deaths, migration, fetal deaths, marriages and divorces. The most common way of collecting information on these events is through civil registration, an administrative system used by governments to record vital events which occur in their populations

How can the government be both a producer and a consumer in respect to its relationship with business

Answers

Answer:

they gonna tinda and be kind to the coatumets

Answer:

they are gonna tinda and be nice to the caotmautes

Problem 17-1A Comparing costs using ABC with the plantwide overhead rate LO P1, P3, A1, A2

Answers

Answer:

$67.50 per hour

Explanation:

Setup Cost = $312,500

Transportation Cost = $10,000

Direct Labor cost $25,500

Modification of machine cost $12,000

Insurance of Factory Premises $28,000

Raw material Cost $118,250

Machine hours = 7,500 hours

labor hours = 3,500  hours

Total manufacturing Overheads = $506,250 / 7,500 = $67.5 per hours

The user growth rate of a social media platform decreased by 15% per month. On January 1, the platform had 20 million users. If growth decreases at 15% each month, how many will it have by year end?

Answers

Answer:

2.844835 million current users

Explanation:

20 million x .85 x .85 x .85 x .85 x .85 x .85 x .85 x .85 x .85 x .85 x .85 x .85

What are three ways to discover how to involved in your chosen career field

Answers

Answer:

Research industry information. ...

Find out about professional associations. ...

Research career options using LinkedIn.

Devon, a Project Manager is working on a software development project. He needs more coders to complete the project on time. As a result, he hires people and they are given on-the-job training by their coworkers. However, this significantly reduces the output of th team and leads to a delay in the project. The given scenario exemplifies:

Answers

Answer: the mythical man-month effect

Explanation:

The scenario given in the question above signifies the mythical man-month effect.

According to the mythical man-month effect, it explains that when more programmers are added to a particular project, this eventually led to a delay in the project.

Since we are told that Devon needs more coders to complete the project on time and therefore hired more people to complete the project but eventually led to a delay, thus signifies the mythical man-month effect.

2) On the basis of the calculations you have made, explain which location Saber should
choose.

Answers

Answer:

Explanation:

physical attributesphysical attributesphysical attributesphysical attributesphysical attributesphysical attributesphysical attributesphysical attributesphysical attributes

Which of the following list of factors of production would be considered land?

O Factories, assembly lines, buildings

O Farms, tractors, pesticides

O Iron ore, natural gas, water

O Dams, bridges, oil wells

Answers

Most likely answer is option 1
Other Questions
Simplify (9y-x ) (xy+3y) If [e]t was the concentration of lactase in the kinetics trials, what expression gives the concentration of lactase in the commercial preparation of this enzyme? Alan is analyzing potential market segments. He should carefully seek potential customers who have both an interest in his products and:__________ The field of ____________________ focuses on the study of the meanings of words and other morphemes as well as how the meanings of phrases and sentences derive from them. Look at the rectangle and the square: a rectangle pqrs and square lmno are drawn side by side. the length sr of the rectangle is labeled as 16 inches, and the width qr is labeled as 8 inches. the side lm of the square is labeled as 8 inches ada says that the length of diagonal sq is two times the length of diagonal om. is ada correct? justify your answer and show all your work. your work should state the theorem you used to find the lengths of the diagonals. (10 points) i will report you if you do it for the points!!! A four-person committee is chosen from a group of eight boys and six girls.If students are chosen at random, what is the probability that the committee consists of all boys?100115100110143O133143 . Use the three-point general rubric to evaluate the paragraph.Different Types of PlantsThere are many different type of plants. Some plants are tall, Some is so small that you need a microscop. Plants grow all the world. People even eat some plants for food. Plants are good for the enviornment. They kepe the air clean. The also make our world a prettier place to live.Using the rubrics criterion for your reference, select the answer that best reflects an accurate evaluation of this passage.It has many punctuation, spelling, and grammar errors.It has 1-2 punctuation, spelling, or grammar errors.It has 3-4 punctuation, spelling, or grammar errors.It has no punctuation, spelling, or grammar error Convert 10000 seconds in to the number of equivalent hours minutes and seconds An advertiser claims that 80% of people stream their TV, 10% have cable, and the rest do not watch TV. To evaluate this claim, they take a sample and calculate a test statistic of. If their rejection region is, what would their conclusion be? What: What was happening in the crusade ?Where: Where is the event taking place?When: When did it happen?Why: Why did the crusades happen?How: How did the crusader achieve their goals?PLEAS HERLP ME ________ powers are specifically established by the language of the constitution What word(s) signal(s) implicit reasoning?A. lf/ThenOrB. And How did Shakespeare use sources when he wrote his plays? Your answer should be at least one hundred words. Using the criteria you described in your previous answer, how would you compare solar power to fossil fuel power? 1. state the characteristics of Chrysophytes.2. write the characteristics of dinoflagellates.3. write the characteristics of euglenoids.4. write the characteristics of Slime moulds. PLEAS EFHJFJFJF im stuck pls IM IN A HURRY PLEASE HELP ME QUESTION IS DOWN BELOW WORTH 15 POINTS each The assignment for this lesson is as follows: Write a review of the first part of American Born Chinese that explains your opinion on the effectiveness of two different plot elements. Cite specific evidence from the text to support your analysis, which may be positive, negative, or some of both. Your assignment should include the following elements: Evidence that reveals your understanding of the plot elements you are discussing in your review A clear perspective about how the plot elements in the story affect the reader's experience A paragraph for each plot element you're discussing; each paragraph should use examples from the story A professional and engaging tone that uses parallel structure and varied syntax You should have completed a draft of this assignment in the activity before this one. If you haven't done so, go back and complete that activity now. Ask yourself these questions as you revise: Did I take a clear stance on how successful I thought the use of each plot element was? Does my review contain two paragraphs and address one plot element in each? Is my evidence specific and relevant to my points? Did I use parallel construction at least once, and use it properly? Did I use a variety of phrases and clauses? Use this rubric to determine how well you're meeting the criteria for the assig Explain why a critical thinker is advised to bracket a metaphorical, proverbial and other forms of symbolic language Given the balanced equation: 2KClO3 --> 2KCl 3O2 What type of reaction is represented by this equation