The securities with the lower default risk and having highest credit quality are assigned the rating of
Correct answer: C. triple A
- A. double B
- B. triple B
- C. triple A
- D. double A
Explanation
AAA, or triple-A, is the highest credit rating and indicates the lowest expected default risk. BB and BBB represent materially lower credit quality, while AA is one grade below AAA.
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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.
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