A Credit Default Swap Is

question 65

Multiple Choice

A credit default swap is

• A) a fancy term for a low-risk bond.
• B) an insurance policy on the default risk of a federal government bond or loan.
• C) an insurance policy on the default risk of a corporate bond or loan.
• D) an insurance policy on the default risk of federal government and corporate bonds and loans.
• E) None of the options are correct.

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