Bonds Rated BBB Would Have Lower Yields Than AAA-Rated Bonds

question 31

True/False

Bonds rated BBB would have lower yields than AAA-rated bonds, and higher prices, everything else the same.

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Definitions:

Government Revenue

The total money received by a government from taxes and non-tax sources to finance government operations and services.

Excise Tax

A tax applied to specific goods or services, often included in the price of products such as tobacco, alcohol, and fuel.

Average Tax Rate

The percentage of the total income that is paid as taxes, calculated by dividing the total amount of taxes paid by the taxpayer's total income.

Personal Income

The total amount of income received by an individual or household from all sources before taxes and deductions.