As a Defensive Maneuver, a Firm Issues Deep-Discount Bonds That

question 28

Multiple Choice

As a defensive maneuver, a firm issues deep-discount bonds that are redeemable at par in the event of an unfriendly takeover. These bonds are an example of:

• A) Greenmail
• B) A "scorched earth" policy
• C) Crown jewels
• D) A poison put

---

Definitions:

Uncertain Income

Income that is not guaranteed and can vary significantly from period to period, often depending on factors like market demand or job security.

Marginal Utility

The bonus utility or pleasure experienced by someone when consuming another unit of a given good or service.

Risk-averse

A description of an individual's or entity's preference for avoiding loss over making a gain.

Expected Income

The income an individual anticipates to earn in the future based on current circumstances, potential investments, and employment prospects.