The Default Risk Premium Fluctuates Mainly

question 78

Multiple Choice

The default risk premium fluctuates mainly

• A)because bond rating agencies tend to be inconsistent in their ratings of bonds.
• B)because risk-neutral investors will often become risk-averse as time passes.
• C)because taxes tend to rise over the long run.
• D)as new information about a borrower's creditworthiness becomes available.

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Definitions:

Chronological

Organized in the order of time from the earliest to the latest.

Organizational Pattern

The arrangement of ideas and information in a coherent and logical manner to achieve effective communication.

More Important To Less Important

A method of organization where information is presented according to its relative significance, with the most crucial details first.

Organizational Pattern

the structure and arrangement of ideas or content within a piece of writing or speech, designed to enhance clarity and comprehension.