Bonds with relatively high risk of default are called
A)Brady bonds.
B)junk bonds.
C)zero coupon bonds.
D)investment grade bonds.

Question

Quizplus · Accepted Answer

Junk bonds are bonds that have a high risk of default, and therefore carry a higher yield to compensate for this risk. They are also known as speculative bonds or high yield bonds. Brady bonds are bonds issued by developing countries that have been restructured and are seen as less risky than traditional junk bonds. Zero coupon bonds are bonds that do not pay interest, but are sold at a discount and pay out the face value at maturity. Investment grade bonds are bonds that have a lower risk of default and are considered safer investments.

Bonds with Relatively High Risk of Default Are Called