Interest rate risk and default risk are equivalent terms.

Name: Interest rate risk and default risk are equivalent terms.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Interest rate risk refers to the risk that changes in interest rates will affect the value of an investment or an entity's cash flows. Default risk, on the other hand, refers to the risk that a borrower will not be able to repay its debt obligations. While both risks may be relevant to an investment, they are not equivalent terms.

Interest Rate Risk and Default Risk Are Equivalent Terms