SIE practice questionmediumBond ratings
Which of the following best describes a non-investment grade bond?
- AA Treasury bond
- BA bond rated 'AAA'
- CA municipal GO bond
- DA bond rated 'BB' by Standard & Poor’s✓ Correct answer
Explanation
Why D — A bond rated 'BB' by Standard & Poor’s
S&P bonds rated 'BB' or lower are considered speculative ('junk'). 'AAA' ratings are highest investment grade; municipal and Treasury bonds often have higher ratings.
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