The Hazard Rate for a Firm Evolves as Follows $$\lambda ( t ) = 0.2 + 0.5 t$$

question 18

Multiple Choice

The hazard rate for a firm evolves as follows: $$\lambda ( t ) = 0.2 + 0.5 t$$ .The probability of the firm defaulting in the next year is:

• A)0.24
• B)0.36
• C)0.48
• D)0.60

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Definitions:

Influence

Influence is the capacity to have an effect on the character, development, or behavior of someone or something, or the effect itself.

Real Danger

An actual threat that poses a genuine risk of harm or damage.

Persuasive

Pertaining to the ability to convince or influence others through argument, reasoning, or appeal.

Act

A piece of legislation passed by a governing body, or the process of doing something with a specific purpose or intention.