The yield curve shows and firm specific risk

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1. The “yield curve” shows

The credit quality of a bond.

The coupon payment on a bond.

The par value of a bond.

The relationship between years to maturity and yield to maturity on bonds of the same or similar issuers.

2. Firm specific risk

A. is the risk of a unique adverse event happening to a firm.

B. depends on the state of the bond markets

C. is not relevant for international firms.

D. is greater in bull than bear markets.

Reference no: EM131868005

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