Which of the following statements is false? A.   The sovereign credit rating is a risk of a national government becoming unable to satisfy its loan obligations.   B.   Bond prices are inversely related to spreads.   C.   Issuer credit ratings are based on the overall creditworthiness of the firm.   D.   Liquidity is observed when there is a large difference between the offered sale price and the bid price.

Which of the following statements is correct about corporate bond/ A.The corporate bond with AAA rating has zero default risk.All else equal,the corporate bond with better credit rating has lower yield to maturity B.Corporate bonds bonds have zero default risk and fixed coupon payments C.The corporate bond credit risk is assessed by the credit rating agency D.Default risk referto the likelihood that firm will walk away from the its bond obligations involuntarily

(I) Because interest rates on Treasury bills are more volatile than rates on long-term securities, the return on short-term Treasury securities is usually above that on longer-term Treasury securities. (II) A Treasury STRIP separates the periodic interest payments from the final principal repayment. A. (I) is true, (II) false. B. (I) is false, (II) true. C. Both are true. D. Both are false.

When estimating cost of debt, the firm should not simply use current short-term rates because these rates do not reflect expectations regarding Group of answer choices long-term inflation expansionary monetary policy contractionary monetary policy short-term inflation

Under which of the following situation, would a firm most likely to  call its outstanding callable bonds? Group of answer choices a)The firm has financial distress. b)The company’s bonds are downgraded. c)The market interest rate increases d)The market interest rate declines

Suppose you inherit $100,000 at age 25 and immediately invested in a growth fund who’s annual rate of return average is 13%. Five years later, you transfer all proceeds from the scrubs fun into a long-term IRA that pays an average annual rate of 8%. Immediately you start making additional contributions of $7000 per year to the same IRA. Assuming continuous interest, steady interest rates, and a perfect record of making annualcontributions, how much is this IRA worth when you reach the age of 65? The formula that will need to be used is A = P e^r*t + D/r (e^r*t - 1). Hint: use the continuous interest formula to find the accumulated amount for the first five years, which is then the annual investment, P, into the IRA. 

What are the main risks that credit ratings reflect? Do we need creditratings? What are the parameters and risks that credit risk ratings do notincorporate and investors need to be aware of?

Does governance of firms affect the prices of their bonds?Point: No. Bond prices are primarily determined by interest rate movements and therefore are not affected by the governance of firms that issue the bonds.Counter-Point: Yes. Bond prices reflect the risk of default. Firms with more effective governance may be able to reduce their default risk and thereby increase the prices of their bonds.Who is correct?

Bonds that have investment-grade ratings from sources such as S&P tend to have higher interest (coupon) rates due to higher default risk. True False

please answer asap for a good rating