A Bond's Rating Can Depend on All of the Following

question 52

Multiple Choice

A bond's rating can depend on all of the following except

• A) the corporation's debt-equity ratio.
• B) the corporation's size.
• C) the ability of the firm to make interest payments.
• D) the coupon rate on the bond.

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Definitions:

Absolute Advantage

A country's ability to produce a certain good more efficiently than another country can.

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost than others, enabling trade and increased efficiency.

Trade Better Off

The idea that parties involved in voluntary trading are better off as they satisfy each other's needs or wants.

Absolute Advantage

The ability of an entity to produce a good or service more efficiently than its competitors with the same amount of resources.