Question

Which of the following bonds carry significant risk that the issuer will not make current or future payments?

A. credit quality risk bonds
B. interest rate risk bonds
C. liquidity rate risk bonds
D. junk bonds

Answer 1

Junk bonds carry significant risk that the issuer will not make current or future payments. So, the correct answer is option D.

Step-by-step explanation:

Among the given options, the bonds that carry significant risk that the issuer will not make current or future payments are junk bonds. Junk bonds are high-yield bonds that have a relatively high chance of defaulting on the payments. These bonds offer a higher rate of return but come with a higher level of risk. Investors can reduce the risk by diversifying their portfolio and investing in bonds from different companies.

So, the correct answer is option D.