The two major bond rating agencies are Moody's and S&P l. Explain how they rate bonds and why it's important?.

Q: answer both and explain why

A: Question 1:False.Generally, debt is considered a cheaper source of funding than equity. Here's…

Q: Which of the following is the worst measure of the cost of debt? Estimating Interest Rate based on…

A: The cost of debt is the effective return that a company pays for its debt to its debtholders. It is…

Q: “Investing in bond is easy because investors can choose the bond based on the bond rating given by…

A: Bonds are issued to raise finance for various purposes. The lender pays the bondholder the amount…

Q: How many types of securities traded in international bond markets and Who are the major bond market…

A: Bonds are debt security which is issued by the government or corporates to collect funds. Bonds…

Q: Identify two groups of bonds in the international bond market, describe the characteristics of each…

A: Bond refers to the investment securities in which an investor lends money to the company or the…

Q: “Investing in bond is easy because investors can choose the bond based on the bond rating given by…

A: Bonds are issued to raise finance for various purposes. The lender pays the bondholder the amount…

Q: Compare and contrast the difference between Bond Ratings and Bond Rating Agencies and the Bond…

A: 1 . Bond Ratings:Bond ratings are a means of expressing an issuer's creditworthiness or probability…

Q: Go to finance yahoo and search for bonds. Address the following about the bond that you select and…

A: There are various types of bonds, including: Government bonds: issued by national governments and…

Q: Who rates bonds, andwhat are some of the factors the rating agenciesconsider?

A: Introduction: Bond rating is nothing but the grading of bonds based on their investment qualities.…

Q: hen a corporate bond receives a rating of "BBB" from a credit rating agency, how is this rating…

A: Bonds are given different rating by agencies based on the risk of default and risk involved in the…

Q: What ratings comprise investment-grade bonds and what ratings are used for junk bonds?

A: “Hey, since there are multiple questions posted, we will answer first question. If you want any…

Q: Rating agencies—such as Standard & Poor’s (S&P) and Moody’s Investor Service—assign credit ratings…

A: Investment-grade bonds-Such bonds are issued by low risk to medium risk lenders and pay low…

Q: Describe the relationship between bond prices and inclation. would you be more inclined to buy bonds…

A: Bond prices have an inverse relation o interest rates. When the interest rates increase, the bond…

Q: What is Walmarts bond rating?

A: The bo d rating is an instrument that measures the creditworthiness of corporate and government…

Q: Which of the following facilitates trading of short term corporate bonds in an economy? Select one:…

A: Short term corporate bonds are issued by government and companies for short term financing…

Q: What ratios are likely to be of greatest interest to the banker or trade creditor? To the…

A: The objective of the question is to identify the financial ratios that are of greatest interest to a…

Q: Which of the following bond is the safest?  Treasury Bonds Corporate Bonds Savings Bonds

A: Bonds are a form of liability for the business, for which regular interest payments along with value…

Q: Debt Securities - These securities are in the form of debt or borrowings which have to be repaid by…

A: Debt Securities or Debt Instruments - Debt securities are financial instruments that provide their…

Q: Should financial institutions invest in junk bonds?

A: The answer for the theory question on junk bonds is discussed hereunder.  Dear student,  As you have…

Q: Do bond ratings adjust immediately to changes in credit quality? Explain.

A: Bond ratings are the ratings given by the rating agencies on the credit quality of debt instruments…

Q: Initially, bond ratings were paid for by the bond purchaser. Today bonding ratings are under an…

A: Bond: Bonds are financial debt instruments that are issued by corporate agencies or governments for…

Q: List the four main types of bonds in order from least risky to most risky. Describe who issues these…

A: Meaning of a bond: A bond is a form of loan in which a lender is lending the borrower a certain sum…

Q: Bonds are rated according to default risk. Given the government default-free term structure of…

A: The term structure of interest rates: The term structure of interest rates depicts the yields of…

Q: Bonds that are rated less than investment grade by bond-rating agencies is: a. Sovereign bonds b.…

A: Bond is the fixed income securities which promises the holder future coupon payments.

Q: d. How does the credit spread change with the bond rating? Why? (Select the best choice below.) A.…

A: CONCEPT. 1. bond rating. Bond ratings represent credit worthiness of corporate bond or government…

Q: Explain callable and putable bonds in detail. Why are they important to issuing firms or investors?

A: Callable bond: The bond having the privilege to redeem by the issuer before maturity.   Puttable…

Q: Compare the risk of buying a U.S. government bond to that of buying acorporate bond.

A: Bonds are a financial instrument that gives its holder a fixed coupon/interest. It is a form of debt…

Q: Which should have the higher risk premium on itsinterest rates, a corporate bond with a Moody’s Baa…

A: it is  important to define risk premium Risk premium means it is investment return, an asset is…

Q: 2) Which should have the higher risk premium on its interest rates, a corporate bond with a Moody's…

A: Risk premium means it is investment return, an asset is expected to yield a surplus of a risk-free…