Wide Credit Spreads

question 95

Multiple Choice

Wide credit spreads:

• A)represent a low price for risk
• B)show that investors are concerned about the risks posed by bonds
• C)occur when investors are very confident in the ability of borrowers to repay debt
• D)tend to narrow during times of crisis, like the GFC
• E)increase the profitability of trading for bond dealers.

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Definitions:

Wear-And-Tear

The damage or deterioration that occurs as a result of ordinary use over time.

Programmed Aging

The theory that aging is a biological process controlled by specific genes.

Tertiary Aging

The progression of changes in an individual that are due to disease, rather than due to normal aging or genetics.

Lifespan

The length of time a living being, especially a human, exists from birth to death.