The Credit Spread of a Bond Shrinks If It Is

question 44

True/False

The credit spread of a bond shrinks if it is perceived that the probability of the issuer defaulting increases.

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Definitions:

Septra

A brand name for a combination antibiotic containing sulfamethoxazole and trimethoprim, used to treat a variety of bacterial infections.

Diuril

A trade name for the medication chlorothiazide, a diuretic drug used to treat high blood pressure and fluid retention.

Lasix

A brand name for furosemide, a medication used to treat fluid retention (edema) and swelling caused by congestive heart failure, liver disease, kidney disease, and other medical conditions.

Detrol

A medication used to treat symptoms of an overactive bladder, such as frequent or urgent urination.