Corporate Bonds Rated Aaa
March 2nd, 2008 | 
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Question: School Financial ? I am having problems with?
In a recent year, interest rates on long-term government and Corporate Bonds were as follows:
T-bond= 7.72% AAA= 8.72% A=9.64% BBB=10.18%
The differences in rates among these issues were caused by?
A. tax effects, B. default risk differences, C. maturity risk differences
D. inflation differences, E. both b and d are correct
Answer: risk.
Higher risk = higher return
JCCC Board of Trustees Meeting 4-15-09
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