Question

In: Economics

As a general rule, a company's (corporation) debentures have higher required interest rates than United States...

As a general rule, a company's (corporation) debentures have higher required interest rates than United States government bonds.

True

False

Solutions

Expert Solution

Answer = True

Reason = Since Debentures are backed by any physical assets , that is the reason they are considered riskier and with higher risk also comes higher returns so investors keeping this in mind demand higher returns while United states government bonds are considered safer since they are backed by physical assets

Rahul Sunny answered 2 years ago
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