The Cumulative Default Probability of a Borrower in a Given

question 88

True/False

The cumulative default probability of a borrower in a given time period is one minus the product of the marginal default probabilities for all time periods up to that time period.

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Definitions:

Marginal Product

The additional output that is produced by adding one more unit of a specific input, while holding other inputs constant.

Total Dollars

The aggregate or total amount of money without adjusting for factors such as inflation or purchasing power.

Optimal Factor Mix

The most efficient combination of resources and inputs a firm uses to produce goods or services at the lowest cost.

Resource Markets

Markets where productive inputs, such as labor, natural resources, and capital, are bought and sold.