A Callable Bond Will Typically Have a Yield Than an Otherwise

question 59

Multiple Choice

A callable bond will typically have a yield than an otherwise identical bond without a call feature because .

• A) lower, the firm loses flexibility with a callable bond
• B) higher, the option to call a bond is valuable
• C) lower, the option to call a bond is valuable
• D) higher, the firm loses flexibility with a callable bond

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