- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 29. Credit Analysis Models
- Subject 5. Interpreting Changes in Credit Spreads
CFA Practice Question
An issuer with zero default probability and a 50% of recovery rate should have a credit spread of ______.
B. 50 basis points
C. 100 basis points
A. zero
B. 50 basis points
C. 100 basis points
Correct Answer: A
A zero default probability means zero credit risk.
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