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Basic Question 0 of 6
"As the growth rate in real gross national product slowed, the difference in yield between BAA rated and AAA rated bonds widened." This situation is an example of ______.
B. credit spread risk
C. downgrade risk
A. default risk
B. credit spread risk
C. downgrade risk
User Contributed Comments 4
| User | Comment |
|---|---|
| sarath | Business cycles affect the spread in required retuns between securities with different risk classifications.. |
| magicchip | flight to safety. |
| cong | When economy is in a bad condition, the credit spread widens. |
| 2014 | when economy is bad condition, banks reduces lending. Because credit risk rises |
I used your notes and passed ... highly recommended!
Lauren
Learning Outcome Statements
demonstrate the application of the Code of Ethics and Standards of Professional Conduct to situations involving issues of professional integrity
recommend practices and procedures designed to prevent violations of the Code of Ethics and Standards of Professional Conduct
identify conduct that conforms to the Code and Standards and conduct that violates the Code and Standards
CFA® 2026 Level I Curriculum, Volume 6, Module 3.