Question
If the CDS spread for a regular 5-year CDS is 150 basis points, what is the CDS spread for a 5-year binary CDS on the
If the CDS spread for a regular 5-year CDS is 150 basis points, what is the CDS spread for a 5-year binary CDS on the same underlying reference entity? Assume a recovery rate of 30%.
114 basis points
200 basis points
214 basis points
500 basis points
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Fundamentals of Financial Management
Authors: Eugene F. Brigham, Joel F. Houston
13th edition
978-1285027371, 128502737X, 978-1133541141
