Question

Bond rating changes impact not only the ____________ of the bonds, but also the ____________ that the company or municipality would have to pay if it issued new bonds.

Question 4 options: 1) PE ratios; underwriting fees 2) Expense ratios; underwriting fees 3) Current prices; interest rate 4) None of the options listed

Answer 1

• Bond rating changes impact not only the current prices of the bonds, but also the interest rate that the company or municipality would have to pay if it issued new bonds.

So, the correct answer is 3) Current prices; interest rate.