If Zeus Energy bonds are upgraded from BBB- to BBB+,which of the following statements is true?
A) The current bond price will decrease and interest rates on new bonds issue will increase.
B) Interest rates required on new bond issue will increase.
C) The current bond price will decrease.
D) The current bond price will increase and interest rates on new bonds issue will decrease.

Question

Quizplus · Accepted Answer

When a bond's rating is upgraded, it is seen as less risky, which typically leads to an increase in its price. Additionally, the issuer can offer new bonds at lower interest rates because the improved rating suggests a lower risk of default.

If Zeus Energy Bonds Are Upgraded from BBB- to BBB+,which