The Cumulative Default Probability of a Borrower in a Given

question 88

True/False

The cumulative default probability of a borrower in a given time period is one minus the product of the marginal default probabilities for all time periods up to that time period.

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Definitions:

Output

The quantity of goods or services produced in a certain period of time by a person, machine, or industry.

Price Taker

A market participant who has no influence over the market price and must accept the prevailing market price for its products or services.

Price Maker

An entity, typically a firm, with enough market power to influence or set the price of its product or service rather than taking the market price as given.