The default risk is measured by large traders, managers and investors with the help of _________?
Correct answer: B. analyzing financial ratios
- A. sinking analysis
- B. analyzing financial ratios
- C. portfolio scenario value
- D. automated machine analysis
Explanation
Default risk is commonly assessed by examining financial ratios such as leverage, interest coverage, liquidity, and profitability. These ratios indicate the borrower’s ability to meet interest and principal payments.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? support@testustad.com
About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
Practise Business Finance
975 free Business Finance MCQs from Management Sciences, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Exams that ask Management Sciences questions like this
Management Sciences is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Business Finance questions
The type of rating which all the credit rating agencies do not consider is classified as __________?
The promised payments on the Eurobonds will be paid in the __________?
The Eurobonds are issued by financial firms to _________?
The mortgage bonds issued by the corporations are considered as _________?
The bonds that are considered as junk bonds and termed as higher yield are classified as ________?
The department who is appointed by the bond holders as the representative or monitor of bonds is considered as _________?