statistics-3409727-2

Each stated characteristic is a sample estimate. The 95% confidence intervals are [0.07 to 0.09] for PD, [$160,000 to $200,000] for EAD, and [0.19 to 0.34] for LGD. What effect does this uncertainty have on the expected loss? Select the correct choice below and if necessary, fill in the answer box to complete answer. I chose (A) because I’ve seen an example, but don’t know the answer.
(A) The expected loss becomes the interval [$____ and $_____] (type integers or decimals)

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