In a CDS with a notional principal of $100 million the reference entity defaults. The payoff to the buyer of protection when the recovery rate is 30% is: choose one)

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In a Credit Default Swap (CDS), the payoff to the buyer of protection in the event of a default is the difference between the notional principal and the recovery amount. With a notional principal of $100 million and a recovery rate of 30%, the recovery amount is $30 million ($100 million * 30%). Therefore, the payoff is $100 million - $30 million = $70 million.

In a CDS with a Notional Principal of $100 Million