If the Cumulative Mortality Rate in Year 3 Is 3

question 8

Multiple Choice

If the cumulative mortality rate in year 3 is 3.46 percent for the B-rated loan, what is its yearly mortality rate in year 3?

• A)1.25 percent.
• B)1.21 percent.
• C)1.00 percent.
• D)0.90 percent.
• E)0.875 percent. [Refer to: 10-112]

---

Definitions:

Oil Futures

Oil futures are contracts to buy or sell oil at a predetermined price on a specified future date, used for hedging or speculation on oil price movements.

Risk-Free Rate

The rate of return on an investment with no risk of financial loss, typically associated with government bonds.

Oil Futures

Contracts to buy or sell oil at a predetermined price on a specified future date, used as a financial instrument for hedging or speculative purposes.

Risk-Free Rate

This rate is considered the minimum return investors expect for any investment, since they would not take on additional risk without the prospect of higher returns, often pegged to government-issued securities.