A Call Provision Gives Bondholders the Right to Demand, or "Call

question 19

True/False

A call provision gives bondholders the right to demand, or "call for," repayment of a bond.Typically, calls are exercised if interest rates rise, because when rates rise the bondholder can get the principal amount back and reinvest it elsewhere at higher rates.

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Definitions:

Wrongful Acts

Actions that are illegal or immoral, causing harm or damage to others.

Limited Liability Company

A type of business structure where owners have limited personal liability for the debts and actions of the company.

Legal Person

An individual or organization that has legal rights and obligations, capable of entering into legal contracts, and can sue or be sued.

Limited Liability Company

A business structure that combines the pass-through taxation of a partnership with the limited liability of a corporation.