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Expected loss (EL) has three components: probability of default (PD), exposure amount (EA), and loss rate (LR). With respect to these components of EL, each of the following is true EXCEPT which is not accurate?
A
Exposure amount (EA) is the standard deviation of credit losses estimated at the end of the horizon excluding outstanding interest payments.
B
Probability of default (PD) is the probability that a borrower will default before the end of the relevant period.
