- CFA Exams
- CFA Level I Exam
- Topic 6. Fixed Income
- Learning Module 14. Credit Risk
- Subject 3. Factors Impacting Yield Spreads
CFA Practice Question
The higher the credit risk of a bond, ______.
II. the greater the volatility of its returns
III. the higher the liquidity risk
I. the higher the required yield
II. the greater the volatility of its returns
III. the higher the liquidity risk
Correct Answer: I and II
User Contributed Comments 2
| User | Comment |
|---|---|
| warnggg | Why not C? |
| ahmed999 | @WARNGGG because the liquidity risk is entirely different and not related by anyway to credit risk. |