In the Diagram in Question #13 Above, Where Curve 0ABC

Multiple Choice

In the diagram in Question #13 above, where curve 0ABC relates the market value of LDC external debt to the face value of the external debt, the range __________ indicates a situation where debt relief or forgiveness for LDCs would reduce amount of debt owed by developing countries but would also increase the market value of the debt. In this range, any one bank __________.

A) AB; would lose by forgiving debt unless all other banks also forgave debt
B) AB; could gain by forgiving debt even though other banks did not forgive debt
C) BC; would lose by forgiving debt unless all other banks also forgave debt
D) BC; could gain by forgiving debt even though other banks did not forgive debt