Question: Urban Shocker has noted that the spread between the yield-to-maturity on BBB-rated bonds and that on AAA-rated bonds has recently widened considerably. Explain to Urban

Urban Shocker has noted that the spread between the yield-to-maturity on BBB-rated bonds and that on AAA-rated bonds has recently widened considerably. Explain to Urban what this change might indicate.

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A widening of the yield spread likely indicates an increase in the difference in the default p... View full answer

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