A CDS with a Number of Reference Entities Provides for Each

question 16

Multiple Choice

A CDS with a number of reference entities provides for each reference entity a payoff if it defaults.What is a name for this CDS?

• A) Binary CDS
• B) Add-up Basket CDS
• C) First-to-Default CDS
• D) n-to-Default CDS

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Definitions:

Low Reward

A concept in psychology and behavior analysis indicating a minimal positive incentive or payoff for a certain action or behavior, often leading to lower motivation to pursue that action.

High Reward

A significant incentive or outcome that encourages the continuation or repetition of a behavior.

Positive Contrast Effect

The phenomenon where the perceived value or intensity of a stimulus is increased when juxtaposed with a less attractive stimulus.

Hyperalgesia

An increased sensitivity to a painful event.