You will need to review the activity resources and then research credit risk so you will better understand the benefits and detractors of credit risk, then respond to the questions listed:
1. Evaluate the need for credit risk and current strategies for measuring and managing such a practice within financial institutions.
2. Support the value of credit derivatives for financial institutions. Please ensure you include the impacts of interest rates on derivative products.
3. Identify the positives and negatives of credit risk and how could you apply credit to your benefit?