Credit risk: Flash quiz - Round 2 question 1

[vjoyram]

Hi David,

Can you please confirm the use of the formula in the calculation of the PD? I know there are 2 different ones and they both come down to the same thing but for some reason I cannot get the correct answer. Thanks.

 

[David Harper CFA FRM]

Hi vjoyram,

Please note, just in case you didn't notice, that clicking the magnifying glass gives an explanation. In this this case, the explain goes to a spreadsheet (I like to do this, frankly, just to reduce the error that associates with handwritten explains for the more difficult calcs): http://www.editgrid.com/bt/frm_2008/credit_rd2_q1

So, it continues to look good to me, let me know if the XLS gives you pause. Thanks, David