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    Credit Rating: Public debt rated by a major rating agency.

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    Why would a company pay to have its public debt rated by a major rating agency (such as Moody's or Standard and Poor's)? Why might a firm decide not to have its debt rated?

    © BrainMass Inc. brainmass.com June 3, 2020, 8:46 pm ad1c9bdddf

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    Before a company goes to market, its finance executives need to know what its credit rating is, why it is what it is, and what they can do to influence it. Some finance executives now routinely use rating agencies before making major decisions. They want to know how their rating would be affected by a particular acquisition, stock repurchase or reorganization, so they pay rating agencies ahead of time to rate scenarios that are still ...

    Solution Summary

    This posting examines the reason as to why companies pay to have their public debt rated and why a firm may decide not to do so in 293 words.