Most us corporate bonds are investment grade

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Reference no: EM13911776

True or False

1. Most US corporate bonds are investment grade.

2. Most US corporate convertible bonds are investment grade.

3. Assume Mehta and Gonzalez are both firms in the Mexican steel manufacturing industry. Mehta has no debt and Gonzalez is 50% debt. Both firms have comparable market values. According to the CAPM, Gonzalez should have a higher expected return.

4. Investors react negatively (i.e., a < 0 on the announcement date) to a firm announcing a secondary equity offering.

Reference no: EM13911776

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