Credit Default Swaps
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hardLOS 27.a
An investor is the protection buyer in a USD 20 million senior CDS on Alpha, Inc. After a credit event, Alpha's subordinated debenture trades at 12% of par, its 5-year senior unsecured debenture at 28% of par, and its 3-year senior unsecured debenture at 35% of par. The CDS payoff is closest to:
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