What is expected loss of this loan contract

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Reference no: EM131901710

One period loan contract has a principal amount of 100000 EUR.

The probability of default is 5.5 %.

In case of default on average 50% of principal value of the loan is lost due to the legal costs and fire sales price of the collateral.

What is Expected Loss of this loan contract?

Reference no: EM131901710

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