What Are Junk Bonds

question 192

Multiple Choice

What are junk bonds?

• A) Junk bonds are those that yield low interest rates.
• B) Junk bonds are those that never mature.
• C) Junk bonds refer to bonds that have been resold many times.
• D) Junk bonds are those issued by financially weak corporations.

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Definitions:

Expansion Path

A curve in input space showing how the optimal mix of inputs changes as the firm expands output.

Fixed Proportion

Refers to a production process where inputs must be used in strict, unchanging ratios to produce an output.

Capital

Assets used for the production of goods and services, such as buildings, machinery, and equipment.

Optimal Ratio

The most efficient or favorable balance or proportion among elements or variables in a given context or system.