Purpose: Bond or debt securities pay a stated rate of interest. This rate of interest is dependent on the risk associated with the investment. Moody's Investment Service provides ratings for companies that issue debt securities.

Address: http://www.moodys.com/index.shtml Steps: From Moody's homepage choose SiteMap.

\section*{Instructions}

Answer the following questions:

(a) What year did Moody's introduce the first bond rating?

(b) List three basic principles Moody's uses in rating bonds.

(c) What is the definition of Moody's Aaa rating on long-term taxable debt?