Final answer:
An investor purchasing zero-coupon corporate bonds would NOT be exposed to credit risk, market risk, reinvestment risk, or inflationary risk.
Step-by-step explanation:
An investor purchasing zero-coupon corporate bonds would NOT be exposed to credit risk, market risk, reinvestment risk, or inflationary risk.
Zero-coupon bonds are bonds that do not pay periodic interest payments like traditional bonds. Instead, they are sold at a discount to their face value and redeemed at face value upon maturity.
Since zero-coupon bonds do not pay periodic interest, the investor is not exposed to credit risk (the risk of the issuer defaulting on interest or principal payments), market risk (the risk of fluctuations in interest rates affecting the bond's value), reinvestment risk (the risk of not being able to reinvest interest payments at the same rate), or inflationary risk (the risk of inflation eroding the purchasing power of interest payments).