Which of the Following Statements Is True

question 77

Multiple Choice

Which of the following statements is true?

• A) Investment grade bonds are those rated single B and higher.
• B) Federal laws typically allow insurance companies and pension funds to purchase non-investment grade bonds.
• C) Because investors are risk averse, they require a premium to purchase a security that exposes them to default risk.
• D) All else equal, the higher a bond's rating the higher the coupon rate.

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Definitions:

Convicts

Individuals found guilty of a crime and sentenced by a court, often resulting in imprisonment or other forms of punishment.

Religious Dissidents

Individuals who disagree or challenge the established doctrines or practices of their religion, often leading to significant reform or the creation of new religious movements.

Bacon's Rebellion

A 1676 armed rebellion led by Nathaniel Bacon against the colonial government of Virginia, arising from settlers' frustrations with Native American policies and governmental corruption.

Blacks And Whites

Refers to people of African descent (Blacks) and people of European descent (Whites), often used in discussions about race relations and societal constructs of race.