Which of the Following Is Generally NOT a Characteristic of Rights

question 29

Multiple Choice

Which of the following is generally NOT a characteristic of rights?

• A) No expiration date
• B) If exercised, results in the dilution of earnings for existing shareholders
• C) Saleability
• D) Potential listing on a stock exchange

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Definitions:

Coupon Rate

The interest rate that a bond issuer will pay to a bondholder, typically expressed as an annual percentage of the bond's face value.

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to a change in interest rates, usually expressed in years.

Perpetuity

A financial term for a constant stream of identical cash flows with no end.

Yield

The earnings from an investment, like dividends or interest, shown as a percentage of the investment's original cost or its current market valuation.