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Lower-Rated Bonds Offer Higher Returns Than Higher-Grade Bonds Because Their

Question 114

Multiple Choice

Lower-rated bonds offer higher returns than higher-grade bonds because their:


A) coupon interest rates steadily increase throughout their lives.
B) risks are higher.
C) maturity values are higher than their market values.
D) returns are attractive to risk-averse investors.
E) returns are tax free.

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