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    Exam Code:

    Exam Name: C-S4CS-2402

    Version: V13.25

    Q & A: 72 Questions and Answers

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    NEW QUESTION: 1
    The probability of default of a security over a 1 year period is 3%. What is the probability that it would not have defaulted at the end of four years from now?
    A. 11.47%
    B. 88.53%
    C. 12.00%
    D. 88.00%
    Answer: B
    Explanation:
    Explanation
    The probability that the security would not default in the next 4 years is equal to the probability of survival raised to the power four. In other words, =(1 - 3%)

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