As technology allows information regarding the financial health of corporations to become easier to obtain, we should expect:
A) the risk spread to decrease.
B) the role of bond rating agencies to become more important.
C) a decrease in the number of participants in the bond market.
D) the risk spread to increase.

Question

Quizplus · Accepted Answer

With easier access to information about the financial health of corporations, investors can make more informed decisions, reducing uncertainty and thus the risk spread between bonds of different credit qualities.

As Technology Allows Information Regarding the Financial Health of Corporations