The local bank on Main Street makes a loan. The borrower's project fails, and all the money is lost. The borrower is unable to pay the loan back. This scenario describes _____ risk.

Name: The local bank on Main Street makes a loan. The borrower's project fails, and all the money is lost. The borrower is unable to pay the loan back. This scenario describes _____ risk.
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Question

Quizplus · Accepted Answer

This scenario describes default risk, which is the risk that a borrower will be unable to repay their loan.

The Local Bank on Main Street Makes a Loan