The copula is given to be Clayton. How can the max and min possible probabilities abide by the co-monotonic and counter-monotonic copula, which are different from Clayton copula?
Hi Alp, Ah - here, we are not looking for the Clayton copula, rather to recognise and apply the copulas representing the upper bound (co-monotonic copula) and lower bound (counter-monotonic copula) for the probability of ruin of both companies for the next year, to the values of u and v previously calculated. I see how you would think that the Clayton applies to (b) and (c) by the preamble though and agree it is a little ambiguous! I hope that is clear but please let me know if it is not. Alvin.
