Question 1:Corporate Bonds Which of the following describes the call feature of a bond? a- The issuing...

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Finance

Question 1:Corporate Bonds Which of thefollowing describes the call feature of a bond?

a- The issuing company may choose to call the bond and requirethe bondholder to turn in the bond in exchange for receiving thebond's call price.

b- The bondholder may call and request a higher coupon paymentin exchange for a deferral of the principal payment date.

c-The issuing company may require the bondholder to exchangetheir bond for preferred stock.

d-The bondholder has the right to sell the bond back to theissuing company at coupon payment dates.

Question2 :Bond Prices, Coupons and YTMs A $1,000 parbond has a 9% coupon and a 10% ytm. This bond must sell________________.

a- for the same value as last year's price   b- at itspar value c- at a premium d- at a discount

Question 3: Default Protections All but whichone of the following will tend to reduce the required yield on acorporate bond?

a- A sinking fund where the issuer may repurchase a givenfraction of the outstanding bonds each year.

b- A sinking fund where the issuer sets aside money each year toensure the bond principal can be repaid when due

c- A requirement that all future debt issues must besubordinated to the current debt.

d- A call provision with a five year deferred call.

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Question 1:Corporate Bonds Which of thefollowing describes the call feature of a bond?a- The issuing company may choose to call the bond and requirethe bondholder to turn in the bond in exchange for receiving thebond's call price.b- The bondholder may call and request a higher coupon paymentin exchange for a deferral of the principal payment date.c-The issuing company may require the bondholder to exchangetheir bond for preferred stock.d-The bondholder has the right to sell the bond back to theissuing company at coupon payment dates.Question2 :Bond Prices, Coupons and YTMs A $1,000 parbond has a 9% coupon and a 10% ytm. This bond must sell________________.a- for the same value as last year's price   b- at itspar value c- at a premium d- at a discountQuestion 3: Default Protections All but whichone of the following will tend to reduce the required yield on acorporate bond?a- A sinking fund where the issuer may repurchase a givenfraction of the outstanding bonds each year.b- A sinking fund where the issuer sets aside money each year toensure the bond principal can be repaid when duec- A requirement that all future debt issues must besubordinated to the current debt.d- A call provision with a five year deferred call.

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