A ____ is a type of derivative in which the seller promises to pay the buyer of a particular security the value of that security if it goes into default.

Question

Quizplus · Accepted Answer

A credit default swap is a type of derivative in which the seller promises to pay the buyer of a particular security the value of that security if it goes into default. A derivative is a financial instrument that derives its value from an underlying asset or security. A mortgage-backed security is a type of derivative that pools together mortgages and sells them to investors. A futures contract is a derivative that involves an agreement to buy or sell an asset at a fixed price on a specific date in the future.

A ____ Is a Type of Derivative in Which the Seller