Which of the Following Factors Are Included in the Rating

question 91

Multiple Choice

Which of the following factors are included in the rating analysis of a corporate bond?
I. the issue's indenture provisions
II. the liquidity position of the issuing company
III. the issuing company's relative debt burden
IV. the stability of the company's earnings

• A) I and II only
• B) I, II and III only
• C) II, III and IV only
• D) I, II, III and IV

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Definitions:

Monthly Interest Rate

The percentage of interest that is charged or earned on a loan or investment over a month's time period.

Credit Policy

A set of guidelines that a company follows to determine credit terms for customers, such as payment period and discount rates.

Discounted Price

Discounted Price refers to a price that has been reduced from the original or listed cost, often to accelerate sale or clearance or as part of promotional offers.

Credit Terms

Credit terms are the payment conditions imposed by suppliers on customers, including the amount of time allowed to pay off the amount due.