12-16 The all-in-spread (AIS)used in the KMV model is the difference between the interest rate on a loan and the prime lending rate at the time the loan was originated.

Question

Quizplus · Accepted Answer

The all-in-spread (AIS) used in the KMV model is the difference between the expected default rate and the risk-free rate, not the difference between the interest rate on a loan and the prime lending rate.

12-16 the All-In-Spread (AIS)used in the KMV Model Is the Difference