The Risk Spread Is

question 3

Multiple Choice

The risk spread is:

• A) the difference between a bond's purchase price and selling price.
• B) the difference between the bond's yield and the yield on a U.S. Treasury bond of the same maturity.
• C) less than 0 (zero) for a U.S. Treasury bond.
• D) assigned by a bond-rating agency.

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Definitions:

Coin

A flat, typically round piece of metal with an official stamp, used as money.

68%

In the context of a normal distribution, it refers to the percentage of data that falls within one standard deviation of the mean.

Germination Rate

The percentage of seeds that successfully sprout and begin to grow over a given period.

Seeds

The reproductive material of plants, usually enclosed in a protective outer covering, capable of developing into another plant.