Which of the following bonds would have the lowest interest rate? All of the bonds have 10 years to maturity.

Question

Quizplus · Accepted Answer

Mortgage bonds rated AAA are considered the safest and have the lowest risk of default, so they typically have the lowest interest rate. Bonds rated CCC and high-yield bonds are considered much riskier and have much higher interest rates, while debenture bonds and convertible bonds rated BBB are somewhere in between.

Which of the Following Bonds Would Have the Lowest Interest