This practice question set consists of 14 pages reviewing the following concepts:
* Describe external rating scales, the rating process, and the link between ratings and default.
* Explain the potential impact of ratings changes on bond and stock prices.
* Compare external and internal ratings approaches.
* Explain and compare the through-the-cycle and at-the-point internal ratings approaches.
* Describe a ratings transition matrix and explain its uses.
* Describe the process for and issues with building, calibrating, and backtesting an internal rating system.
* Identify and describe the biases that may affect a rating system.
We have also provided individual links for each question to their respective forum discussion.
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