Why Do Corporations Find High Bond Ratings Desirable

question 105

Multiple Choice

Why do corporations find high bond ratings desirable?

• A) Higher interest rates on the bonds mean higher corporate profits.
• B) Higher ratings improve a company's image with consumers.
• C) Higher ratings mean lowered corporate operating costs.
• D) Firms can sell more bonds when they are highly rated.
• E) Bonds with higher ratings are less likely to have to be repaid.

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Definitions:

Firm-Specific Knowledge

Specialized knowledge that is valuable and unique to a particular company, including its processes, practices, and intellectual property, contributing to its competitive advantage.

Internal Candidates

Employees within an organization who are considered for a vacant position or promotion, as opposed to sourcing candidates from outside the organization.

Succession Management

The process of identifying and developing new leaders who can replace old leaders when they leave, retire, or die.

Labour Gaps

Refers to the discrepancies between the skills and qualifications employers require and those that employees possess.