Multiple Choice
Imagine a scandal that finds the officers of bond rating agencies have been taking bribes to inflate the rating of specific bonds. This should:
A) have no impact on the bond market since bond markets are highly efficient.
B) decrease the demand for all bonds.
C) increase the demand for U.S. Treasury securities and decrease the demand for corporate bonds.
D) decrease the risk spread.
Correct Answer:
Verified
Correct Answer:
Verified
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