Listed Below Are Some Provisions That Are Often Contained in Bond

question 60

Multiple Choice

Listed below are some provisions that are often contained in bond indentures.Which of these provisions,viewed alone,would tend to reduce the yield to maturity that investors would otherwise require on a newly issued bond?
​1) Fixed assets are used as security for a bond.
2) A given bond is subordinated to other classes of debt.
3) The bond can be converted into the firm's common stock.
4) The bond has a sinking fund.
5) The bond has a call provision.
6) The indenture contains covenants that restrict the use of additional debt.

• A) 1,3,4,6
• B) 1,4,6
• C) 1,2,3,4,6
• D) 1,2,3,4,5,6
• E) 1,3,4,5,6

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Definitions:

Myocardial Infarction

A medical condition, commonly known as a heart attack, resulting from the interruption of blood flow to a part of the heart, causing heart cells to die.

Heart Failure

A medical condition in which the heart is unable to pump blood efficiently throughout the body, leading to symptoms such as fatigue, breathlessness, and fluid retention.

Jugular Vein Pulsations

Observable pulsing of the jugular veins in the neck, which can indicate the heart's function and central venous pressure.

Normal Splitting

A physiological phenomenon where the heart's second sound (S2) separates into two distinct sounds during inhalation due to the delay in closure between the aortic and pulmonary valves.