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A Call Provision for the Redemption of a Bond

Question 18

Multiple Choice

A call provision for the redemption of a bond:


A) requires an advance payment of all of the interest that would be paid from the call date until the maturity of the bond.
B) allows the firm to refinance debt.
C) allows the firm to call the bonds for redemption at any time after the bond has been issued.
D) requires the redemption of the bonds at their market price.
E) requires bondholders to convert their bonds into lower coupon rate bonds.

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