Which of the Following Statements Is FALSE

question 22

Multiple Choice

Which of the following statements is FALSE?

• A)Before the call date,investors anticipate the optimal strategy that the issuer will follow,and the bond price reflects this strategy.
• B)The yield to maturity of a callable bond is calculated as if the bond were called at the earliest opportunity.
• C)A callable bond will trade at a lower price (and therefore a higher yield)than an otherwise equivalent non-callable bond.
• D)The price of a callable bond can be low when yields are high,but does not rise above the call value when the yield is low.

---

Definitions:

Department Spend

Relates to the total amount of money allocated and spent by a specific department within an organization.

Ensuring Budget

A financial plan that is designed to make sure all finances are covered and allocated appropriately for a certain period, often aimed at preventing overspending or deficits.

Business Planning Spectrum

Encompasses the variety of strategic and operational planning activities within a business, from long-term vision setting to short-term action planning.

Sustainable Growth Rate

The maximum rate at which a company can grow its sales and earnings without increasing its financial leverage.