Which of the Following Is NOT a Major Factor in the Credit

question 100

Multiple Choice

Which of the following is NOT a major factor in the credit rating process conducted by agencies such as Standard & Poor's?

• A) Sovereign risk of the country of the issuer
• B) Industry risk associated with the type of issuer
• C) Financial capacity of the issuer
• D) Return attached to the particular issue

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Definitions:

IRS

The Internal Revenue Service, a U.S. government agency responsible for the collection of taxes and enforcement of tax laws.

Reversing Temporary Difference

An accounting adjustment that reverses differences between tax and financial reporting over time.

Originating Temporary Difference

A difference that arises in a particular period between the book income and taxable income, which is expected to reverse in the future.

Municipal Bonds

Debt securities issued by municipalities or local governments to finance public projects, typically offering tax-exempt interest payments to investors.