A model for estimating the probability of debt rescheduling (Ri) is given as follows: R =...
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A model for estimating the probability of debt rescheduling (Ri) is given as follows: R = 0.32 DSR + 0.52 IR - 0.08 INVR + 0.67 VAREX + 0.78 MG (DSR=Debt Service Ratio; IR=Import Ratio; VAREX=Variance of Export Revenue; MG=Domestic Money Supply) Two countries are being evaluated on their Sovereign risk based on only two variables (in percentages), the details of which are given here below: Country A Country B MG 40 VAREX 3 30 10 Which country possesses the most sovereign risk based only on the two variables indicated above? Support your answer with detailed computations (10 Points). A model for estimating the probability of debt rescheduling (Ri) is given as follows: R = 0.32 DSR + 0.52 IR - 0.08 INVR + 0.67 VAREX + 0.78 MG (DSR=Debt Service Ratio; IR=Import Ratio; VAREX=Variance of Export Revenue; MG=Domestic Money Supply) Two countries are being evaluated on their Sovereign risk based on only two variables (in percentages), the details of which are given here below: Country A Country B MG 40 VAREX 3 30 10 Which country possesses the most sovereign risk based only on the two variables indicated above? Support your answer with detailed computations (10 Points).
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