Junk bonds (i.e., bonds issued by companies with weak financial positions) rated ____ or lower by Moody's.

Question

Quizplus · Accepted Answer

Junk bonds are typically rated below investment grade, which means they have a relatively high risk of default. Moody's rates these bonds based on their credit risk, with lower ratings indicating higher risk. Baa and BBB ratings are above junk bond status, indicating a higher level of creditworthiness. Ba and CCC ratings represent lower grades of creditworthiness, indicating a higher likelihood of default. Thus, the correct choice for junk bonds would be C) Ba and D) CCC.

Junk Bonds (I