Which of the following statements is true?
A)The more liquid the bond, the lower the yield.
B)Tax-free bonds normally have a higher interest rate than other types of bonds.
C)The price of a bond increases as it becomes more risky.
D)The yield curve illustrates the relative default risks of alternative types of bonds.

Question

Quizplus · Accepted Answer

More liquid bonds typically have lower yields because investors are willing to accept a lower return for the ease of buying and selling the bond.

Which of the Following Statements Is True