Which of the following is true regarding fixed-income securities?
A) Treasury bonds are subject to default risk
B) Corporate bonds are always very liquid
C) Bond prices rise when interest rates increase
D) A premium bond sells for less than its face value
E) The default risk varies with the bond issuer

Question

Quizplus · Accepted Answer

The default risk varies with the bond issuer. Treasury bonds are considered to have no default risk, while corporate bonds typically have a higher default risk. Bond prices generally decrease when interest rates increase. Premium bonds sell for more than their face value, while discount bonds sell for less.

Which of the Following Is True Regarding Fixed-Income Securities