Which of the following bond ratings indicate junk bonds? A/A Baa/BBB Ba/BB B/B Both c. and...

Question

Question

Which of the following bond ratings indicate junk bonds?

A/A

Baa/BBB

Ba/BB

B/B

Both c. and d.

Answer 1

Answer #1

Answer:

Both c.and d.

Explanation

Both c and d rating bonds are indicate junk bonds

Answer 2

Similar Homework Help Questions

bonds with relatively low risk of default are called 1) Bonds with relatively low risk of...

bonds with relatively low risk of default are called 1) Bonds with relatively low risk of default are called securities and have a rating of Baa (or BBB) a above; bonds with ratings below Baa (or BBB) have a higher default risk and are called A) investment grade; lower grade C) high quality; lower grade B) investment grade; junk bonds D) high quality; junk bonds 2) Which of the following bonds are considered to be default-risk free? A) municipal bonds...
Just the answer please 13. Bonds with relatively low risk of default are called securities and...

Just the answer please 13. Bonds with relatively low risk of default are called securities and have a rating of Baa (or BBB) and above; bonds with ratings below Baa (or BBB) have a higher default risk and are called A) investment grade; lower grade B) investment grade; junk bonds C) high quality; lower grade D) high quality; junk bonds 14. Junk bonds, bonds with a low bond rating, are also known as A) high-yield bonds. B) investment grade bonds....
12. Which of the statements regarding bonds is true? (a) A bond with a BB rating...

12. Which of the statements regarding bonds is true? (a) A bond with a BB rating is regarded as a junk bond. (b) A bond with AAA rating would never default. (c) The minimum coupon rate for a bond is the Federal funds rate. (d) For newly issued bonds, the coupon rate cannot be higher than the prime rate.

A 10-year Treasury note has a yield of 2.71 percent, and a Baa (BBB) corporate bond...

A 10-year Treasury note has a yield of 2.71 percent, and a Baa (BBB) corporate bond with comparable maturity has a yield of 4.93 percent. The difference in yields owes to: a. Differences in credit risk b. Differences in liquidity c. Expected inflation d. Both a and b
Credit Rating Yield AAA 3% AA 3.2% A 3.5% BBB 3.8% BB 4.5% B 5.25% a....

Credit Rating Yield AAA 3% AA 3.2% A 3.5% BBB 3.8% BB 4.5% B 5.25% a. Given the yields for bonds with different credit ratings, what would be the fair price of a 5-year maturity bond, which currently has identical risk to a bond rated ‘A’, if it has a coupon rate of 12% paid annually, and a par value of $1,000? b. What would be the price of the bond 3 years from today if the bond is expected...
10. Bond ratings Aa Aa Rating agencies-such as Standard & Poor's (S&P), Moody's Investor Service, and...

10. Bond ratings Aa Aa Rating agencies-such as Standard & Poor's (S&P), Moody's Investor Service, and Fitch Ratings-assign credit ratings to bonds based on both quantitative and qualitative factors. These ratings are considered indicators of the issuer's default risk, which impacts the bond's interest rate and the issuer's cost of debt capital. Based on these ratings, bonds are classified into investment-grade bonds and junk bonds. Which of the following bonds is likely to be classified as a junk bond? OA...

Using calculating formula Credit Rating Yield AAA 3% AA 3.2% A 3.5% BBB 3.8% BB 4.5%...

Using calculating formula Credit Rating Yield AAA 3% AA 3.2% A 3.5% BBB 3.8% BB 4.5% B 5.25% a. Given the yields for bonds with different credit ratings, what would be the fair price of a 5-year maturity bond, which currently has identical risk to a bond rated ‘A’, if it has a coupon rate of 12% paid annually, and a par value of $1,000? b. What would be the price of the bond 3 years from today if the...
What are the ratings of investment grade bonds, and at what rating does 'junk' begin? What...

What are the ratings of investment grade bonds, and at what rating does 'junk' begin? What factors separate the two types of bonds? Which type of bond do you think will pay higher interest?
19) curity: AAA Corporate 56 AA Corporate A Corporate BBB Corporate BB Corporate ield (%): A...

19) curity: AAA Corporate 56 AA Corporate A Corporate BBB Corporate BB Corporate ield (%): A mining company needs to raise $100 million in order to begin open-pit mining of a coal seam. The company will fund this by issuing 30-year bonds with a face value of $1,000 and a coupon rate of 6.5%, paid annually. The above table shows the yield to maturity for similar 30-year corporate bonds of different ratings. If the company's bonds are rated A, what...

Indicate which bond in the following pairs of bonds is likely to bear the higher interest...

Indicate which bond in the following pairs of bonds is likely to bear the higher interest rate (yield) and state why. If there is no general reason for a difference, indicate that they would be the same. a. A corporate bond rated Aaa or a municipal bond rated Aaa b. a municipal bond rated Baa or a municipal bond rate Aa c. A general obligation bond issued by a city or a revenue bond issued by a city d. a...