Public Utility Issues Have a Greater Yield Than Other Corporate

question 69

Multiple Choice

Public utility issues have a greater yield than other corporate issues primarily because

• A)Nuclear utility issues carry an extremely high risk premium
• B)Public utility issues generally have a longer maturity
• C)Investor demand for utility issues is greater than for other issues
• D)Utilities demand for funds is greater than that of other segments

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Definitions:

Equity Financing

The process of raising capital through the sale of shares in a company, providing investors ownership interests.

Debt Financing

The raising of capital through borrowing money that must be repaid over time, usually with interest.