Question
a. How risk management practices create value in imperfect capital markets? b. Forward contracts are a zero-sum game. What do you think is meant by
a. How risk management practices create value in imperfect capital markets?
b. Forward contracts are a zero-sum game. What do you think is meant by this statement?
c. Credit risk is one of the major risks faced by commercial banks and can be a major reason for inflicting higher losses for the banks. Every bank needs to develop a framework for managing this risk. You as a student of financial risk management, are expected to develop a brief framework for credit risk management. Your framework should include the five stages of the risk management process.
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