The Interest Rate on Convertible Bonds Is Typically One-Third Higher

question 19

True/False

The interest rate on convertible bonds is typically one-third higher than similar non-convertible issues.

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Definitions:

Joint Tenants

Joint Tenants is a term used in real estate to describe a form of co-ownership where all owners hold an equal share of the property, and have a right of survivorship, meaning upon the death of one tenant, the property's ownership transfers to the surviving tenant(s).

Sever the Joint Tenancy

The legal process of converting a joint tenancy into a tenancy in common, thus allowing the owners to own a property in equal or unequal shares.

Option Agreement

A subsidiary contract creating an obligation to hold an offer open for acceptance until the expiration of a specified time.

Lease

A secured arrangement whereby possession of the goods goes to the lessee, while the title to the goods remains with the lessor.