Based on an Option Valuation Method,the EDF Model

question 40

Multiple Choice

Based on an option valuation method,the EDF model:

• A)determine if the equity is mispriced.
• B)calculate the market value of the lender's investment.
• C)estimates the probability that a firm will default over a specified period of time.
• D)estimate the likelihood that the Z-score model is correct.
• E)estimates the probability that the firm's rating will change over a period of time.

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