A CDS with a Number of Reference Entities Provides a Payoff

question 11

Multiple Choice

A CDS with a number of reference entities provides a payoff when any of the reference entities 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:

Latent Learning

A form of learning that occurs without any obvious reinforcement of the behavior or associations that are learned.

Insight

The ability to understand the inner nature of things or a deep understanding of a person or situation, often leading to a sudden clear solution after a period of confusion.

Learning Set

The ability to become more efficient in learning new tasks based on experiences gained from learning previous tasks.

Response Set

A tendency for a person to respond to questions or situations in a patterned way, often based on habit or bias rather than thoughtful consideration.