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:

Opposition To Current

Resistance or any impedance facing the flow of electric current in a circuit, hindering the movement of charge.

Low-pass

A filter designed to allow signals with a frequency lower than a certain cutoff frequency to pass through while attenuating frequencies higher than the cutoff frequency.

Notch Filter

A filter designed to remove or significantly reduce the strength of a specific frequency or range of frequencies from a signal.

Band-rejection

A filter that blocks frequencies within a certain range, allowing frequencies outside that range to pass through.