8 Questions
What is the traditional credit risk related to?
Default on payments
What is the likelihood of default known as?
Probability of default
Where does counterparty risk arise from?
Financial markets
What is pre-settlement risk also known as?
Replacement risk
How can losses from the failure of a counterparty be evaluated?
In terms of current and potential exposure to an organization
What is default risk primarily concerned with?
The failure to make interest payments to lenders
What does the probability of default refer to?
The likelihood of a debt issuer failing to make contractual interest payments
Why is credit risk often considered a one-way risk?
It exists when an organization is owed payment or an obligation by another party
Test your knowledge of credit risk and default probability with this quiz. Explore the concept of one-way risk and traditional credit risk, including default on payments and the probability of default.
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