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I think you are correct. The question referred to corporate rather than structured and for corporates indeed very few default from investment grade within one year. What threw me was "very few" given how statistically orientated the exam is plus they were trying to decide between a raing...

re question about chosing to either create an internal ratings system or go with agencies, the logical choices seemed to be either: a bond rated investment grade at the beginning of the year is unlikely to default or ratings in the depths of the business cycle have less quality. Still unsure as...

re question about chosing to either creat internal ratings or go with agencies, the logical choices seemed to be either a bond rated investment grade at the beginning of the year is unlikely to default or ratings in the depths of the business cycle have less quality. Still unsure as to the best...

Towards the end of the exam there was a question about a team deciding on buiding an interal rating system or using the ratig agencies. I narrowed it down to two choices: Unlikley a bond rated investment grade at the beginnig of the year defaults or at he dpeths of teh business cycle ratings...