Which of the Following Statements Is Correct

question 119

Multiple Choice

Which of the following statements is correct?

• A) Other things held constant,a callable bond would have a lower required rate of return than a noncallable bond.
• B) Other things held constant,a corporation would rather issue noncallable bonds than callable bonds.
• C) Reinvestment rate risk is worse from a typical investor's standpoint than interest rate price risk.
• D) If a 10-year,$1,000 par,zero coupon bond were issued at a price which gave investors a 10 percent rate of return,and if interest rates then dropped to the point where r_d = YTM = 5%,we could be sure that the bond would sell at a premium over its $1,000 par value.
• E) If a 10-year,$1,000 par,zero coupon bond were issued at a price which gave investors a 10 percent rate of return,and if interest rates then dropped to the point where r_d = YTM = 5%,we could be sure that the bond would sell at a discount below its $1,000 par value.

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Definitions:

Opposing Political Views

Divergent or conflicting ideologies and beliefs regarding governance, policy, and political systems.

Social Media Website

An online platform that enables users to create and share content or to participate in social networking.

Underlying Sexism

The subtle and often unnoticed presence of sexist attitudes or discrimination based on sex or gender within societal structures.

Mainstream Media

Established and widely accepted media outlets or platforms that reach a large audience, often regarded as traditional forms of media.