Question $1$

$[10]$

In recent years, there has been quite a buzz about credit default swaps. The turn of events following the $2008$ Global Financial Crisis became a test of the systems that settle credit default swaps.

a$.$ Why are credit default swaps $($CDS$)$ necessary?

$(2)$

b$.$ Why are some investors not in favour of credit default swaps?

$(2)$

c$.$ Magong Rural Investments has invested R$80$m in bonds issued by Moepi