What is a municipal bond, Why might Moody's want to have a

What is a municipal bond

Reference no: EM131305424

Moody's has a separate ratings scale for municipal bonds. Here is Moody's definition of its Aaa rating for municipal bonds: "Issuers or issues rated Aaa demonstrate the strongest creditworthiness relative to other US municipal or taxexempt issuers or issues."

a. What is a municipal bond?

b. Why might Moody's want to have a separate ratings scale for municipal bonds, and why might those ratings be based on creditworthiness relative to other bond issuers?

Reference no: EM131305424

Questions Cloud

Explain the design tradeoff between duty cycle precision : Explain the design tradeoff between duty cycle precision, and maximum clock frequency. Why would in some applications it be preferable to have less precise duty cycles?

Write a computer program using matlab to read constants : This project is individual work. Write a computer program using Matlab to read the engineering constants E1, E2, v12, and G12 then computes and prints the Reduced Compliances Matrix [S], the Reduced Stiffness Matrix [Q], the Rotated Transformed Comp..

Investigate the effect of flow direction on the heat rate : Based on a typical water draw rate, the velocity over the pipe is 0.5 m/s. The hot oil maintains the outer surface temperature at 85°C and the water temperature is 37°C.

Why would the risk premium be higher on republic services : In 2010, Republic Services, a waste management firm, issued 10-year notes and 30-year bonds. - Why would the risk premium be higher on Republic Services's 30-year bonds than on its 10-year notes?

What is a municipal bond : Why might Moody's want to have a separate ratings scale for municipal bonds, and why might those ratings be based on creditworthiness relative to other bond issuers?

What is the minimum value of the convection heat : In the limiting case of a very small sphere, what is the minimum value of the convection heat transfer coefficient expressed in terms of the sphere diameter and thermal conductivity of the air?

What are two types of income an investor can earn on a bond : What are the two types of income an investor can earn on a bond? How is each taxed?- What "obligations" is Moody's referring to?

Draw a demand and supply graph for bonds : Draw a demand and supply graph for bonds that shows the effect on a bond that has its rating lowered.-How does the interest rate on an illiquid bond compare with the interest rate on a liquid bond?

What is the risk structure of interest rates : What is the risk structure of interest rates? Briefly explain why bonds that have the same maturities often do not have the same interest rates.

User Account

All Pages