An increase in the riskiness of corporate bonds will ________ the yield on corporate bonds and ________ the yield on treasury securities, everything else held constant.

Respuesta :

A decrease in the riskiness of corporate bonds will Decrease the yield on corporate bonds and Increase the yield on Treasury securities, everything else held constant.

So, The answer is D decrease; increase

A sort of financial product sold to investors is a corporate bond, which is issued by a business. The investor receives a predetermined amount of interest payments at either a fixed or variable interest rate in exchange for providing the firm with the money it requires. The bond "reaches maturity" when it stops making payments and the initial investment is refunded. The ability of the corporation to repay the bond often serves as its security, and this ability is based on its expectations for future revenues and profitability. Physical assets of the corporation may occasionally be utilized as collateral.

The question is incomplete, complete question is:

A decrease in the riskiness of corporate bonds will ________ the yield on corporate bonds and ________ the yield on Treasury securities, everything else held constant. A) increase; increase B) decrease; decrease C) increase; decrease D) decrease; increase  

To learn more about Treasury securities here

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