What do the Standard & Poor’s and Moody’s bond ratings provide an asse

QUESTION

What do the Standard & Poor’s and Moody’s bond ratings provide an assessment of?

A) book value
B) risk
C) dividends
D) convertibility
E) SEC compliance

ANSWER

Answer: B
Explanation: B) Standard & Poor’s and Moody’s, the two principal rating services, issue bond ratings that reflect the issuer’s potential to default. A high rating means low risk of default; a low rating reflects a high risk of default.