Those lower-rated bonds are the highest paying because they are also t…

Question

Those lower-rated bonds are the highest paying because they are also the highest:

Accepted Answer

B. Risk

1. Investors demand more return for accepting more danger.
2. The extra coupon is the price of that danger.
3. They are the highest-risk corporate bonds.
_Source: OpenStax Principles of Finance 2e, Chapter 10, Bonds and Bond Valuation._

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Role

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Rank

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Rate

Those lower-rated bonds are the highest paying because they are also the highest:

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