SIE practice questionmediumBond Ratings
A bond rated below BBB/Baa is considered:
- AInvestment grade
- BTax-exempt
- CHigh-yield (junk)✓ Correct answer
- DZero-coupon
Explanation
Why C — High-yield (junk)
Bonds rated below BBB/Baa are considered speculative or high-yield (junk). Investment grade is BBB/Baa or higher. Tax status and coupon features are unrelated to rating.
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