Trudeau can borrow at the riskless rate in every case, but the loan officer tells you that to secure an initial balance of $8000,000 you'd need to repay $8,500,000 what is the cost of your credit risk measured in terms of the difference in the annual rate you receive relative to Trudeau?

Answer rating: 100% (QA)

Assuming that Trudeau can borrow at the riskless rate the cost ... View the full answer