Use the following statements to answer this question:
I.The correlation between a high Altman Z score and the rating by rating agencies is positive
II.Investment-grade firms have a low yield to maturity
A)I and II are correct.
B)I and II are incorrect.
C)I is correct and II is incorrect.
D)I is incorrect and II is correct.

Question

Quizplus · Accepted Answer

Statement I is correct, stating that a high Altman Z score (used to measure a company's financial stability) correlates positively with the rating given by rating agencies. However, statement II is incorrect, as investment-grade firms typically have a low yield to maturity compared to non-investment-grade firms.

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