Which Factor Would Increase the Likelihood That a Company Would

question 56

Multiple Choice

Which factor would increase the likelihood that a company would call its outstanding bonds at this time?

• A)The yield to maturity on the company's outstanding bonds increases due to a weakening of the firm's financial situation.
• B)A provision in the bond indenture lowers the call price on specific dates, and yesterday was one of those dates.
• C)The flotation costs associated with issuing new bonds rise.
• D)The firm's CFO believes that interest rates are likely to decline in the future.

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Definitions:

Lysosomes

Membrane-bound organelles containing enzymes that break down and recycle cellular waste and foreign particles.

Cell Wastes

Byproducts of cellular metabolism that cells eliminate; these can include carbon dioxide, urea, and other substances harmful if accumulated.

Golgi Bodies

Cell organelles that modify, package, and sort proteins and lipids for secretion or for use within the cell.

Schwann Cells

Glial cells in the peripheral nervous system that wrap around axons, forming the myelin sheath and aiding in the rapid transmission of neural signals.