Bonds Are Least Likely to Be Called If

question 100

Multiple Choice

Bonds are least likely to be called if

• A)they are selling at a substantial premium.
• B)they are selling at a substantial discount.
• C)the price is close to par value.
• D)if they do not mature for at least 5 years.

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Definitions:

Derived Demand

The demand for a good or service resulting from the demand for another good or service, as seen in the demand for raw materials driven by the production of final goods.

Substitutes

Products or services that can satisfy the same need or desire, where an increase in the price of one leads to an increase in demand for the other.

Complements

Goods and services that are used together, where the consumption of one enhances the use or value of the other.

Demand

Demand refers to consumers' desire and willingness to purchase a good or service at a specific price level.