There Is an Inverse Relationship Between Bonds' Quality Ratings and Their

question 57

True/False

There is an inverse relationship between bonds' quality ratings and their required rates of return.Thus, the required return is lowest for AAA-rated bonds, and required returns increase as the ratings get lower.

---

Definitions:

Technological Improvements

Innovations and advancements in technology that enhance productivity, efficiency, and quality of goods and services.

Productivity

The measure of the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs.

Average Product

The output per unit of input, such as labor or capital, calculated by dividing total output by the total quantity of the input.

Marginal Product

The additional output produced as a result of using one more unit of a particular input, holding all other inputs constant.