An analyst developed two scenarios with respect to the recovery of $100,000 principal from defaulted loans: The
Question:
The amount of the expected recovery is closest to:
A. $36,400
B. $63,600
C. $81,600
Transcribed Image Text:
Probability of Scenario (%) Probability of Amount (%) Amount Recovered ($) Scenario 60 40 50,000 30,000 40 90 60 80,000 10 60,000
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B is correct If Scenario 1 occurs the expected recovery is 60 50000 40 30000 42000 ...View the full answer
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Related Book For
Quantitative Investment Analysis
ISBN: 978-1119104223
3rd edition
Authors: Richard A. DeFusco, Dennis W. McLeavey, Jerald E. Pinto, David E. Runkle
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