31.Which statement about a junk bond is incorrect? a. b. C. d. These bonds are issued by smaller companies with a high risk of default These bonds pay less interest than the higher rated bonds There is a high chance that the issuing company would not be able to make the ongoing interest payments or pay back the principal Usually, investors with a high-risk tolerance invest in junk bonds
31.Which statement about a junk bond is incorrect? a. b. C. d. These bonds are issued by smaller companies with a high risk of default These bonds pay less interest than the higher rated bonds There is a high chance that the issuing company would not be able to make the ongoing interest payments or pay back the principal Usually, investors with a high-risk tolerance invest in junk bonds
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:31. Which statement about a junk
bond is incorrect?
a.
b.
C.
d.
These bonds are issued by
smaller companies with a
high risk of default
These bonds pay less
interest than the higher
rated bonds
There is a high chance that
the issuing company
would not be able to make
the ongoing interest
payments or pay back the
principal
Usually, investors with a
high-risk tolerance invest in
junk bonds
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