Exam 24: The Many Different Kinds of Debt

Which of the following bonds is secured by assets?

Project finance is extensively used in developing countries to finance:

The holder of a $1,000 face value bond has the right to exchange the bond anytime before maturity for shares of stock priced at $50 per share. The $50 is called the:

The Alfa Co. has a 12% bond outstanding that pays interest on February 1st and July 1st. Today is March 1st and you are planning to purchase one of these bonds. How much will you pay in accrued interest?

What are PIK bonds?

Issuing convertible debt makes sense whenever investors have difficulty estimating the risk of the company's bond.

Corporations typically have the right to repurchase a debt issue prior to maturity at a fixed price. Such debt issues are said to be:

If a corporate security can be exchange for a fixed number of shares of stock, the security is said to be:

The exercise of warrants creates new shares which:

Affirmative covenants impose certain duties on the company.

Convertible bonds can also have a call feature.

Which of the following provisions would often be included in the indenture for a first- mortgage bond?

PIKs are:

A zero-coupon bond is also called:

Government loan guarantees are risk free and costless means for helping struggling firms.

Discuss the valuation of a convertible bond.

A convertible bond issue by a firm can be thought of as:

Issuing convertible bonds or bonds with warrants is useful for a company of unknown risk because

Explain the differences between warrants and convertibles.

Firms often bundle up a group of assets and then sell the cash flows from these assets in the form of securities. They are called: