Which of the following events would make it more likely that a company would choose to call it’s outstanding callable bonds? An increase in market interest rates. An increase in the call premium. All the other statements are correct. The company’s bonds are downgraded. A reduction in market interest rates.

(I) Because interest rates on Treasury bills are more volatile than rates on long-term securities, the return on short-term Treasury securities is usually above that on longer-term Treasury securities. (II) A Treasury STRIP separates the periodic interest payments from the final principal repayment. A. (I) is true, (II) false. B. (I) is false, (II) true. C. Both are true. D. Both are false.

When the total cost of borrowing is less than the bond interest paid, Select answer from the options below the bonds were sold at a discount. the issuing company is likely in poor financial health. the lender is likely to give the issuing company a discount. the bonds were sold above face value.

The contract interest rates and market interest rates of bonds is sometimes different. Why? The market interest rates of corporate bonds are locked in for the term of the bond maturity. Investors want the best rate so bond issuers frequently change their contact rate. There is a lag between the time a corporation decides to issue bonds and the time the bonds are actually issued to the market. The Federal Reserve Bank (FRB) decides that the bond contract rate is out of compliance for similar risk categories. please explain your answer and give coreect answer with right multople choice