According to Moody’s Bond rating, a high-quality bond with low investment risk has the following rating:...

According to Moody’s Bond rating, a high-quality bond with low investment risk has the following rating:

	a.	Aaa
	b.	Daa
	c.	Baa
	d.	Caa

Expert Solution

Answer: Aaa

Aaa Moody's rating is the highest rating on a bond or an issuer and signifies very low credit risk or risk of default.

jeff jeffy answered 3 years ago

Moody’s rating of this bond is Aa2 for this bond. Assume that GE’s bond rating is...

Moody’s rating of this bond is Aa2 for this bond. Assume that GE’s bond rating is A. JEA’s rating is B+. Treasury bond’s rating is AAA. Rank the risk of the four bonds from low to high. WMT, GE, Treasury, JEA WMT, Treasury, JEA, GE Treasury, WMT, GE, JEA Treasury, GE, WMT, JEA

8. Bond Ratings [LO3] Companies pay rating agencies such as Moody’s and S&P to rate their bonds,...

8. Bond Ratings [LO3] Companies pay rating agencies such as Moody’s and S&P to rate their bonds, and the costs can be substantial. However, companies are not required to have their bonds rated; doing so is strictly voluntary. Why do you think they do it?

A company has corporate credit rating of “Ca” by Moody’s. What’s implied default probability over the...

A company has corporate credit rating of “Ca” by Moody’s. What’s implied default probability over the next 4-year horizon based on Moody’s historical data?

Nihau Tech has equal amounts of low-risk, average-risk, and high-risk projects. The firm's overall WACC is...

Nihau Tech has equal amounts of low-risk, average-risk, and high-risk projects. The firm's overall WACC is 11%. The CFO, Ms Chen, believes that this is the correct WACC for the company's average-risk projects, but that a lower rate should be used for lower-risk projects and a higher rate for higher-risk projects. The CEO, Mr. Wu, disagrees, on the grounds that even though projects have different risks, the WACC used to evaluate each project should be the same because the company...

Mr. Jones has $10,000 to invest in three types of stocks: low-risk, medium-risk and high-risk. He...

Mr. Jones has $10,000 to invest in three types of stocks: low-risk, medium-risk and high-risk. He invests according to the following rules: the amount invested in low-risk stocks will be at most $2000 more than the amount invested in medium-risk stocks. At least $4000 will be invested in a combination of low- and medium-risk stocks. No more than $8,000 will be invested in a combination of medium- and high-risk stocks. The expected annual returns are 6% for low-risk stocks, 7%...

The Detroit housing sector consists of three submarkets, high quality, medium quality and low quality. Assume...

The Detroit housing sector consists of three submarkets, high quality, medium quality and low quality. Assume at first that all three submarkets have perfectly inelastic supply curves. a. Draw supply and demand diagrams for each submarket. b. The demand curve in the middle submarket now shifts down as the result of the outmigration of middle class households to the suburbs. Keeping supply curves perfectly inelastic, draw new supply and demand diagrams showing the new equilibrium positions in each submarket. Explain...

Let’s say that there are two types of grapefruits: Low-quality, and high-quality, and consumers buy a...

Let’s say that there are two types of grapefruits: Low-quality, and high-quality, and consumers buy a mix of the two, with high-quality grapefruits being more expensive. T/F/U: If the government puts a single, binding price floor on all grapefruits, the average quality of grapefruit consumed will rise.

Order the following chemicals according to the position of their 1H-NMR signal from low to high...

Order the following chemicals according to the position of their 1H-NMR signal from low to high ppm values CH2Cl2 , CH2Br2, CH4,CH2F2

Which of the following description is true regarding to investment strategies? _____ Conservative – low risk,...

Which of the following description is true regarding to investment strategies? _____ Conservative – low risk, high capitalization, predictable earnings, high yield, and low P/E ratios Growth – high risk, low capitalization, limited earnings record, and no dividends Venture – high risk, average capitalization, low dividend payout, and high P/E ratios Speculative – maximum risk, longer term, average price volatility, and little earnings You purchase 500 shares of BMW on the Frankfurt Stock Exchange paying Ꞓ55 per share. One year...

A bank classifies borrowers as "high risk" or "low risk," and 17% of its loans are...

A bank classifies borrowers as "high risk" or "low risk," and 17% of its loans are made to those in the "high risk" category. Of all the bank's loans, 5% are in default. It is also known that 56% of the loans in default are to high-risk borrowers. Let H represent the event that a randomly selected loan is issued to a "high risk" borrower. Let D be the event that a randomly selected loan is in default. Round your...

Question