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Question
Lower-rated bonds offer higher returns than higher-grade bonds because their:
a. coupon interest rates steadily increase throughout their lives.
b. risks are higher.
c. maturity values are higher than their market values.
d. returns are attractive to risk-averse investors.
e. returns are tax free.
Answer
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Related questions
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Which of the following is true about financial institutions in the United States compared to those in other countries?
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Q:
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e. Firms with relatively low debt ratios have higher expected returns when business is poor.