Multiple Choice
A sinking fund is useful to bondholders because:
A) it stops the company from going under or into default.
B) the funds are usable at the option of the bondholders.
C) when a firm has difficulty making payments this sends a signal of potential default.
D) a balloon payment is necessary to fully pay off the bonds at maturity.
Correct Answer:
Verified
Correct Answer:
Verified
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