What are bond ratings and why are they assigned? Bonds are like loans the issuers get from investors. Just as your credit worthiness is evaluated when you apply for a loan, the credit worthiness of the bond also needs to be evaluated. To do this, independent agencies have created a rating system To help investors evaluate bonds, private rating agendes such as Moody's and Standard & Poor's assign grades to designate a bond's quality. Which of the following statements regarding the rating system are correct? Check all that apply The term Junk bond means that the interest payments are not being met A bond rated Ba by Moody's is comparable to a bond rated 88 by Standard & Poor's Different rating systems are used for corporato versus municipal bonds The rating 8 signios a lower risk of default than a Barating The average yields on bonds are generally lower than the average yields on boods