If you are interested in comparing the difference in yields between two securities with identical maturities...
If you are interested in comparing the difference in yields between two securities with identical maturities but different risk of default, you would be looking at?
a. the yield curve
b. the credit spread
c. the inflation index
d. APR vs EAR
Homework Answers
B) The credit spread
Explanation: Credit spread is used to measure the the default risk of a security. Higher the credit spread higher is the default risk.
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