Which of the Following Statements Is False

question 38

Multiple Choice

Which of the following statements is false?

• A) Investors pay less for bonds with credit risk than they would for an otherwise identical default-free bond.
• B) Credit spreads fluctuate as perceptions regarding the probability of default change.
• C) Credit spreads are high for bonds with high ratings.
• D) We refer to the difference between the yields of the corporate bonds and the treasury yields as the default spread or credit spread.

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Definitions:

Scores

Numerical expressions of performance or achievement, often in the context of tests, games, or evaluations.

Mean

A statistical measure that determines the average value of a set of numbers.

Statistical Significance

A measure that indicates how likely it is that a given result could have occurred by chance, often used in hypothesis testing to determine if results are non-random.

P Value

A statistical measure that helps scientists determine the significance of their research results, indicating the likelihood that the observed results happened by chance.