11-102 If the cumulative mortality rate in year 3 is 3.46 percent for the B-rated loan,what is its yearly mortality rate in year 3?

Question

Quizplus · Accepted Answer

The yearly mortality rate is the difference between the cumulative mortality rate in year 3 and the cumulative mortality rate in year 2. The cumulative mortality rate in year 2 is 2.25 percent. Therefore, the yearly mortality rate in year 3 is 3.46 percent - 2.25 percent = 1.21 percent.

11-102 If the Cumulative Mortality Rate in Year 3 Is