One problem with using CRA statistical credit scoring models to evaluate sovereign credit risk is the classification into only two possible outcomes.

Question

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CRA statistical credit scoring models typically classify sovereign credit risk into two possible outcomes: either the country is considered at risk of default, or it is not. This oversimplification can limit the ability of the model to provide nuanced evaluations of sovereign credit risk, and may not capture important variations in creditworthiness between different countries.

One Problem with Using CRA Statistical Credit Scoring Models to Evaluate