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Which of the following is not an investment grade credit rating?*
- BB+
- BBB+
- BBB
- BBB-
Step by step
Solved in 2 steps
- describe the role of fi nancial statement analysis in assessing the credit quality of a potentialdebt investment;Describe some ways to manage credit risk at a nonfinancialcompanyWhich balance sheet might be most useful to an investor? a. U.S. GAAP balance sheet b. IFRS GAAP balance sheet using cost model c. IFRS GAAP balance sheet using revaluation model
- Which of the following statements is most correct? * An aging schedule is used to determine what portion of customers pay cash and what portion buy on credit. If a firm changes its credit terms from 1/20, net 40 days, to 2/10, net 60 days, the impact on sales can't be determined because the increase in the discount is offset by the longer net terms, which tends to reduce sales. Aging schedules can be constructed from the summary data provided in the firm's financial statements If a firm's volume of credit sales declines then its DSO will also decline. The DSO of a firm with seasonal sales can vary. While the sales per day figure is usually based on the total annual sales, the accounts receivable balance will be high or low depending on the season.Explain the determinants of credit olicy variables. 2. Explain the hotives for the extension of the rade credit.What is the role of transferring credit risk? What is the various instruments used to transfer this risk?
- Explain CECL (“Current Expected Credit Loss”) model.Risk premium is also called A• Risk addictive B• Credit spread C• Debt spread D• Risk spreadCredit analysts are likely to consider which of the following in making a rating recommendation?A . Business risk but not fi nancial riskB . Financial risk but not business riskC . Both business risk and fi nancial risk
- If a bank uses credit risk score to determine who will receive a loan, the credit risk score would be considered the: A. dependent variable B. independent variable C. response variable D. classification variable1. Credit spreads least likely depend on which of the following: A. Market supply B. Market demand C. Financial markets D. Inflationexplain the unique characteristics of the asset class, their associated risks and potential returns. Foreach asset class, you should use one or two examples to support your explanation. Asset Class Characteristics Risk Potential Returns ExampleCash Products Fixed Income Equities CurrenciesDerivatives