Quiz: 4

1. Describe how financial flexibility is related to the capital structure of a firm?

[4 marks]
2. Justify with reasoning which risk would be given most weightage to whilst
establishing the credit rating of a corporate. [4 marks]
3. Briefly explain, with the help of examples, the concept of dual rating and how
is it different from rating shopping. [4 marks]
4. Explain why assessing the management of a firm by a rating agency would
be a difficult task. [2 marks]