Which of the Following Statements Is NOT Correct

question 16

Multiple Choice

Which of the following statements is NOT correct?

• A)The more-likely is default on a security,the higher is its yield.
• B)The better is the credit rating of a security,the lower is its yield.
• C)The higher is the probability of repayment on a bond,the higher is its price.
• D)The higher is the default risk of a bond,the higher is its price.

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Definitions:

Sherman Act

A landmark federal statute in the field of United States antitrust law passed by Congress in 1890 which prohibits monopolistic and anti-competitive practices.

Per Se Violation

An action that is inherently illegal, regardless of intent or the circumstances surrounding the action.

Market Division

An anti-competitive agreement in which competing companies divide markets among themselves, specifying which customers or territories each will serve.

Exclusive-Dealing Contract

An agreement under which a seller forbids a buyer to purchase products from the seller’s competitors.