A bond rated AAA is perceived to have GREATER default risk than a bond rated BBB.

Name: A bond rated AAA is perceived to have GREATER default risk than a bond rated BBB.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

This is false. Bond ratings are used to assess the creditworthiness and default risk of a bond issuer. A bond rated AAA is considered to be of higher quality and lower risk than a bond rated BBB. The lower the rating, the higher the perceived default risk.

A Bond Rated AAA Is Perceived to Have GREATER Default