Which of the Following Is Not True Regarding Callable Bonds

question 30

Multiple Choice

Which of the following is not true regarding callable bonds?

• A)This feature allows the borrower to repay the bonds before their scheduled maturity date.
• B)This feature helps protect the borrower against future decreases in interest rates.
• C)Callable bonds benefit the bond investor.
• D)A bond can be both callable and convertible.

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Definitions:

Regulation

A rule or directive made and maintained by an authority.

Taxation

The process by which governments charge fees on individuals and corporations to fund public services and infrastructure.

Market Inefficiencies

Situations where resources are not distributed optimally in a market, often leading to a loss in economic or social value.

Pollution Permits

Licenses issued by government authorities that allow holders to emit a specific amount of pollutants over a set period, intending to control and reduce environmental damage.