Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. use the information in the table to find the expec

Use the information in the table to find the expected loss amount for a borrower...

80.2K

Verified Solution

Question

Finance

Use the information in the table to find the expected loss amount for a borrower in risk class 11, assuming that loss-given-default is in class 4. The loan amount is $250,000. Expected Loss Rate Risk Class PD LGD Class 1 (0%) LGD Class 2 (25%) LGD Class 3 (50%) LGD Class 4 (75%) LGD Class 5 (100%) 1 0.00 0.00 0.00 0.00 0.00 0.00 2 0.00 0.00 0.00 0.00 0.00 0.00 3 0.00 0.00 0.00 0.00 0.00 0.00 4 0.03 0.00 0.01 0.02 0.02 0.03 5 0.04 0.00 0.01 0.02 0.03 0.04 6 0.24 0.00 0.06 0.12 0.18 0.24 7 0.46 0.00 0.12 0.23 0.37 0.46 8 0.67 0.00 0.17 0.34 0.50 0.67 9 0.90 0.00 0.22 0.45 0.67 0.90 10 2.16 0.00 0.54 1.08 1.62 2.16 11 3.20 0.00 0.80 1.60 2.40 3.20 12 7.76 0.00 1.94 3.88 5.82 7.76 13 12.28 0.00 3.07 6.14 9.21 12.28 14 27.17 0.00 6.79 13.58 20.38 27.17 a. $6,000 b. 2.4% c. $8,000 d. 3.2%

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students