Which Best Describes a Credit Default Swap

question 85

Multiple Choice

Which best describes a credit default swap?

• A) It is designed to reduce interest-rate risk.
• B) The issuer receives payments from the buyer in return for agreeing to make payments to the buyer if the security goes into default.
• C) Issuers are taking out insurance in case of default.
• D) It represents a way for the issuer to establish its creditworthiness.

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Definitions:

Pax-6 Gene

A gene involved in eye and brain development among various animals, illustrating the evolutionary conservation of genetic functions.

Dorsal-Ventral Patterning

The developmental process during which cells in an organism organize along the back-belly axis, crucial for proper anatomical structure and function.

Nerve Cord

A bundle of nerve fibers running the length of an animal's body, which is the central component of its nervous system.

Phylogeny

Phylogeny is a visual representation of the evolutionary history of populations, genes, or species.