CFA Practice Question

There are 252 practice questions for this study session.

CFA Practice Question

In the cash settlement of a CDS,

A. The buyer delivers the defaulted debt and seller pays the par value.
B. The buyer pays the par value and gets the defaulted debt from the seller.
C. The seller pays the buyer the difference between par value and post-default market value of the debt.
Correct Answer: C

A: Physical settlement.

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