Which of the following statements is true?
A) Investment grade bonds are those rated single B and higher.
B) Federal laws typically allow insurance companies and pension funds to purchase non-investment grade bonds.
C) Because investors are risk averse, they require a premium to purchase a security that exposes them to default risk.
D) All else equal, the higher a bond's rating the higher the coupon rate.
Answer: C) Because investors are risk averse, they require a premium to purchase a security that exposes them to default risk.
You might also like to view...
The__________is a government body that has the power to prescribe mandatory safety standards for almost all products used by customers
Fill in the blanks with correct word.
The linear programming model of the production scheduling process is usually used when we have to schedule the production of multiple products, each of which requires a set of resources not required by the other products, over time
Indicate whether the statement is true or false