The Refunding Provision of an Indenture Allows Bonds to Be

question 39

Multiple Choice

The refunding provision of an indenture allows bonds to be retired EXCEPT if

• A) they are replaced with a lower coupon bond issue.
• B) the remaining time to maturity is less than five years.
• C) the remaining time to maturity is greater than five years.
• D) the stated time period in the indenture has not passed.
• E) the stated time period in the indenture has passed.

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Definitions:

Income

Money that an individual or business receives, typically in exchange for providing a good or service, or through investing.

Slope

In mathematics, the rate at which a line inclines or declines, indicating the steepness of the line.

Regression Line

A straight line that describes how a response variable Y changes as an explanatory variable X changes, used in linear regression.

Least Squares Regression Line

A straight line that minimizes the sum of the squared differences between the observed values and the values predicted by the line.