问题如下：
The recovery rate on credit instruments is defined as 1 minus the loss rate. The loss rate can be significantly influenced by the volatility of the value of a firm’s assets before default. All other things being equal, in the event of a default, which type of company would we expect to have the highest recovery rate?
选项： A
trading company active in volatile markets
An Internet merchant of trendy consumer products
C.An asset-intensive manufacturing company
D.A highly leveraged hedge fund
解释：
ANSWER: C
The recovery rate is higher when the assets of the firm in default consist of tangible assets that can be resold easily. More volatile assets mean that there is a greater probability of a fall in market value upon liquidation. So, the tangible assets of a manufacturing company (C) is the best answer.
想问一下B的错误之处在于什么？如果trendy products流动性也比较高，LGD会少？
