The spread between interest rates on low quality corporate bonds and U.S. government bonds
A)widened significantly during the Great Depression.
B)narrowed significantly during the Great Depression.
C)narrowed moderately during the Great Depression.
D)did not change during the Great Depression.

Question

Quizplus · Accepted Answer

During the Great Depression, the spread between interest rates on low quality corporate bonds and U.S. government bonds widened significantly. This was due to the increasing risk of default by corporations as a result of the economic downturn.

The Spread Between Interest Rates on Low Quality Corporate Bonds