Which of the Following Statements About Junk (High-Risk) Bonds Is

question 67

Multiple Choice

Which of the following statements about junk (high-risk) bonds is true?

• A)They never outperform treasury bonds since they're too risky.
• B)The price of junk bonds increase as their perceived risk increases.
• C)They tend to perform best during recessions.
• D)One can profit by owning them if market perceptions of their risk decline.

---

Definitions:

Demand Shift

A change in the demand curve due to factors other than the price of the good, such as changes in consumer preferences or income.

Accounting Majors

Refers to students who specialize in accounting, studying financial reporting, auditing, tax laws, and financial management in college or university.

Tax Legislation

Laws and regulations governing the collection of taxes by the government from individuals and businesses.

Nuclear Physicists

Scientists specialized in the study of the atomic nucleus, involved in research and applications ranging from medical treatments to energy production.