When Calculating Net Present Value for a Bond Refunding Calculation

question 82

Multiple Choice

When calculating net present value for a bond refunding calculation, all of the following are considered either outflows or inflows EXCEPT:

• A) Cost savings with the new interest rates.
• B) Net loss from underwriting cost on old issue.
• C) Net cost of underwriting expense on new issue.
• D) Net cost of call premium.

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Definitions:

Emancipation

The process by which a minor is legally freed from control by their parents or guardians and the parents are freed from any and all responsibility toward the child.

Legal Control

The authority or power to regulate, direct, or dominate within the bounds of the law, often related to property, contracts, or entities.

Minor

An individual under the legal age of adulthood, usually under 18, with certain restrictions on their legal rights and responsibilities.

Exculpatory Clauses

Provisions in a contract that release one party from liability for wrongful acts or negligence.