Each of the Variables in the Credit Scoring Model of Sovereign

question 54

Multiple Choice

Each of the variables in the credit scoring model of sovereign country risk

• A)cannot be measured independently.
• B)has a systematic and unsystematic component.
• C)has a predictable and an unpredictable component.
• D)is determined by a weighted risk index.
• E)has a high systematic risk element.

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Definitions:

Resource Heterogeneity

The principle that resources needed for production, such as labor, capital, and land, differ in their quality and composition across firms or economies.

Temporary Competitive Advantage

A situation where a firm gains an edge over its competitors for a short period due to unique resources or positioning.

Redesign Production

This refers to the process of changing the way a product is created or manufactured to improve efficiency, quality, or adapt to new market demands.

Resource Heterogeneity

The principle that resources and capabilities differ across firms, which can lead to competitive advantages for firms that have unique, valuable, and inimitable resources.