- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 19. Mortgage-Backed Security (MBS) Instrument and Market Features
- Subject 5. Commercial Mortgage-Backed Securities
CFA Practice Question
Other measures being equal, which DSC ratio would be considered the best from a creditor's perspective?
B. A DSC ratio of 1
C. A DSC ratio of 5
A. A DSC ratio of 0.1
B. A DSC ratio of 1
C. A DSC ratio of 5
Correct Answer: C
The higher the ratio, the more likely the borrower can use the property's cash flow to service the debt.
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