The Existence of Rating Agencies Has

question 57

Multiple Choice

The existence of rating agencies has

• A)lowered returns on corporate bonds.
• B)raised returns on corporate bonds.
• C)left returns on corporate bonds largely unaffected.
• D)raised returns on both corporate bonds and Treasury securities.

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Definitions:

Corporation

A legal entity that is separate and distinct from its owners, capable of conducting business, entering into contracts, and owning assets.

Transfer Ownership

The act of moving legal title and rights from one entity or person to another.

Capital Budgeting

Capital budgeting is the process by which companies evaluate and prioritize investments in long-term assets and projects based on potential returns and strategic goals.

Long-Term Investments

Investments held for an extended period, typically exceeding one year, intended for growth, income, or both.