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Given the following regression model: Pi=0.8 Current Ratio 0.4(Gross profit/Total assets) 0.3(Equity/Debt) Where Pi is the probability of repayment. The balance data of ABC Ltd.
Given the following regression model: Pi=0.8 Current Ratio 0.4(Gross profit/Total assets) 0.3(Equity/Debt) Where Pi is the probability of repayment. The balance data of ABC Ltd. is shown in the following table. Current assets $150,000 Non current assets $400,000 Total assets $550,000 Equity $190,000 Current liabilities $250,000 Book value of liabilities $360,000 Sales revenue $1,000,000 Gross profit $15,000 EBIT $250,000 What is the probability of default of this company
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