As their relative riskiness ________, the expected return on corporate bonds ________ relative to the expected return on default-free bonds, everything else held constant.

As their relative riskiness ________, the expected return on corporate bonds ________ relative to the expected return on default-free bonds, everything else held constant.



A) increases; increases
B) increases; decreases
C) decreases; decreases
D) decreases; does not change




Answer: B


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