CFA Practice Question

There are 252 practice questions for this study session.

CFA Practice Question

Which two tend to move together?

I. credit ratings.
II. business cycle.
III. default probabilities of corporate debt.
A. I and II
B. II and III
C. I and III
Explanation: Rating agencies may try be motivated to keep their ratings stable over time.

User Contributed Comments 3

User Comment
janis36 I thought 'together' means in the same direction. Understood now.
Lt2201 This is wrong.
Default probabilities of corporate debt drop as the business cycle improves, vice versa.
jyoti moving together does not mean moving to the same direction. It simply means when one thing moves, another thing will move. II and III will move together while credit ratings are relatively stable (partly because it's a more subjective measure).
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