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In the presentation, Lok is asked why the research team chose to use a reduced-form credit model instead of a structural model. Which statement is
In the presentation, Lok is asked why the research team chose to use a reduced-form credit model instead of a structural model. Which statement is he likely to make in reply? Group of answer choices Structural models require "inside" information known to company management, whereas reduced-form models can use publicly available data on the firm. Structural models are overly complex because they require use of option pricing mod- els, whereas reduced-form models use regression analysis. Structural models are outdated, having been developed in the 1970s; reduced-form models are more modern, having been developed in the 1990s
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