Asked by
pamela sirota
on Nov 08, 2024
Verified
Which one of the following statements concerning bond ratings is correct?
A) Standard and Poor's and Value Line are the primary bond rating agencies.
B) Bond ratings are solely an assessment of the creditworthiness of the bond issuer.
C) Investment grade bonds include only those bonds receiving one of the highest three bond ratings.
D) Bond ratings evaluate the expected price volatility of a bond issue.
E) All bonds receive the same rating classification from all rating agencies.
Bond Ratings
Assessments of the creditworthiness of corporate or governmental bonds, reflecting the issuer's ability to make bond payments, issued by rating agencies.
Creditworthiness
An assessment of a borrower's ability to repay debts in a timely manner, typically considered by lenders before issuing credit.
Investment Grade
A rating that indicates a bond or other security is considered low risk by rating agencies, making it an attractive investment for conservative investors.
- Understand the concept of bond ratings and their relevance to investors.
Verified Answer
KM
Learning Objectives
- Understand the concept of bond ratings and their relevance to investors.