A bond rating agency will rely exclusively on quantitative data to determine the risk that a firm may default on its debt servicing obligations.

Question

Quizplus · Accepted Answer

While quantitative data such as financial statements, credit scores, and market trends are important factors in determining a bond rating, bond rating agencies also consider qualitative factors such as management strength, industry conditions, and other non-financial risks that may affect a company's ability to meet its debt obligations.

A Bond Rating Agency Will Rely Exclusively on Quantitative Data