Which of the Following Is/are True About Callable Bonds

question 32

Multiple Choice

Which of the following is/are true about callable bonds?
I. Must always be called at par
II. Will normally be called after interest rates drop
III. Can be called by either the bondholder or the bond issuer
IV. Have higher required returns than non-callable bonds

• A)I and II only
• B)II and IV only
• C)II and III only
• D)I,II,and III only
• E)I,II,III,and IV are true.

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Definitions:

Situation Determining

A concept that suggests the influence of external environments and circumstances in shaping behavior and decision-making.

Situational Factors

External influences that affect an individual's behavior, decision-making, and psychological well-being in a given context.

Freedom of Movement

A concept often related to psychological and physical liberty, implying the ability to change one's position or travel freely.

Feelings of Inferiority

Emotions that arise from perceiving oneself as less capable or inferior to others, which according to Adler can motivate individuals to strive for superiority.