A Corporation with Long-Term Fixed-Rate Debt Might Prefer Floating-Rate Debt

question 58

Multiple Choice

A corporation with long-term fixed-rate debt might prefer floating-rate debt if they thought that:

• A)interest rates would be declining.
• B)interest rates would be increasing.
• C)their bond rating might be lowered.
• D)their bonds were going to be converted into equity.

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Definitions:

AV Node

A specialized part of the heart's electrical system, acting as a gateway between the atria and ventricles, controlling the heart rate.

Bicuspid Valve

Also known as the mitral valve, it controls blood flow between the left atrium and left ventricle in the heart.

Mitral Valve

A valve in the heart that lies between the left atrium and left ventricle, controlling blood flow.

R00.0

Tachycardia, unspecified; a code representing abnormally rapid heart rate.