Which of the Following Statements About Credit Default Swaps (CDS)

question 176

Multiple Choice

Which of the following statements about Credit Default Swaps (CDS) is correct?

• A) CDS are used to recover funds from defaulted swap counterparties.
• B) CDS provide protection against specified credit events to the party receiving the CDS premium payments.
• C) CDS provide protection against the default of the trade counterparty that buys the CDS.
• D) CDS provide compensation to the protection buyer, should a specified credit event occur to a third party entity.

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Definitions:

Self-Destruction

Behaviors or actions that harm oneself physically, emotionally, or psychologically.

Alcoholics Anonymous

A self-help group designed to assist individuals in recovering from alcoholism through a 12-step program that emphasizes mutual support.

Self-Help

Activities or resources undertaken by individuals seeking to improve their mental, emotional, or physical well-being without professional intervention.

Sobriety

The condition of being free from alcohol or drug intoxication, and often refers to the lifestyle of a person who maintains this state.