If an issuer retires a debt issue before maturity, the specific amount paid to do so...
If an issuer retires a debt issue before maturity, the specific amount paid to do so is called the:
amortized payoff.
call price.
sinking fund amount.
the discount.
par or face amount.
Homework Answers
Correct answer is option a.Call price.
If an issuer retires a debt issue before maturity, the specific amount paid to do so is called the Call price or Redemption price.
The above said call price will be fixed between issuer and investor at the time of issue of bond or preference shares.
Add Answer to:
If an issuer retires a debt issue before maturity, the specific
amount paid to do so...
Hialurily date. • A bond issuer is said to be in default if it does not...
Hialurily date. • A bond issuer is said to be in default if it does not pay the interest or the principal in accordance with the terms of the indenture! agreement or if it violates one or more of the issue's restrictive covenants. • A bond contract feature that requires the issuer to retire a specified portion of the bond issue each year is called a sinking fund provision • A bond's call provision gives the issuer the right to...
6. The feature permits the issuer to repurchase bonds at a stated price prior to maturity....
6. The feature permits the issuer to repurchase bonds at a stated price prior to maturity. A. call D. capitalization 7. The thavalue of a bond is also called its face value. Bonds which sell at less face value are priced at awhile bonds which sell at greater than face value sell at a A. discount; par, premium B. premium; discount; par C par discount; premium D. coupon; premium; discount 8. If you invest $178,571 in a project that generates...
bond gives the issuer an option to retire the bond before maturity at a specific price
bond gives the issuer an option to retire the bond before maturity at a specific price
Calculate the yield to maturity for the 4 bonds listed below Issuer Face Value Coupon Rate...
Calculate the yield to maturity for the 4 bonds listed below Issuer Face Value Coupon Rate Rating Quoted Price Years until Maturity Sinking Fund Call Period ABC Energy $1,000.00 5% AAA $703.10 20 Yes 3 Years ABC Energy $1,000.00 0% AAA $208.30 20 Yes Na TransPower $1,000.00 10% AA $1092.00 20 Yes 5 Years Telco Utilities $1,000.00 11% AA $1206.40 30 No 5 Years
Which of the following statements is true? A. A bond issue that requires the repayment of...
Which of the following statements is true? A. A bond issue that requires the repayment of the entire principal amount at maturity is said to have a balloon maturity. B. When a bond issue is repaid in multiple installments, the method of repayment is called a sinking fund. C. When the final repayment of principal is larger than its par value then it is called a bullet payment. D. When the required return equals the coupon rate, the fair price...
22. Which of the following statements concerning preferred stocks is true? a. Preferred stockholders have anrior...
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Define the Following terms. What is Capital structure? Example of Debt/ Equity instruments What Is a...
Define the Following terms.
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10. A callable corporate bond can be purchased by the bond issuer before maturity for a...
10. A callable corporate bond can be purchased by the bond issuer before maturity for a price specified at the time the bond is issued. Corporation X issues two bonds (bond A and bond B) at the same time with the same maturity, par value, and coupons. However, bond A is callable and bond B is not. Which bond will sell for a higher price and why? (a) Bond B; bond A should have the value of bond B minus...
1st blank options = par value, coupon payment, price 2nd blank options = bankruptcy, default, liquidation...
1st blank options = par value, coupon payment, price
2nd blank options = bankruptcy, default, liquidation
3rd blank options = convertible provision, sinking fund
provision, call provision
4th blank options= call provision, call premium,
convertibility provision
5th blank options = floating-rate, fixed-rate
6th blank options = indenture, trustee, debenture
7th = multiple choice
1. Characteristics of bonds To be effective issuing and investing in bonds, knowledge of their terminology, characteristics, and features is essential. For example: • A bond's_ par...
Question 5 A callable bond O is generally call protected during the entire term of the bond issue. O generally will...
Question 5 A callable bond O is generally call protected during the entire term of the bond issue. O generally will have a call protection period during the final three years prior to maturity. O may be structured to pay bondholders the current value of the bond on the date of call. O is prohibited from having a sinking fund also is frequently called at a price that is less than par value.
Hialurily date. • A bond issuer is said to be in default if it does not pay the interest or the principal in accordance with the terms of the indenture! agreement or if it violates one or more of the issue's restrictive covenants. • A bond contract feature that requires the issuer to retire a specified portion of the bond issue each year is called a sinking fund provision • A bond's call provision gives the issuer the right to...
6. The feature permits the issuer to repurchase bonds at a stated price prior to maturity. A. call D. capitalization 7. The thavalue of a bond is also called its face value. Bonds which sell at less face value are priced at awhile bonds which sell at greater than face value sell at a A. discount; par, premium B. premium; discount; par C par discount; premium D. coupon; premium; discount 8. If you invest $178,571 in a project that generates...
bond gives the issuer an option to retire the bond before maturity at a specific price
22. Which of the following statements concerning preferred stocks is true? a. Preferred stockholders have anrior claim on the income and assets of the firm as compared to the claims of lenders. b. Preferred stock dividends per share are normally increased as the earnings of the firm increase. c. Preferred dividends per share are usually not cut or suspended unless the firm is faced with serious financial problems. d. The par value of a stock is always the same as...
Define the Following terms.
What is Capital structure? Example of Debt/ Equity instruments What Is a bond? Bond Terminology/Features: Indenture Principal/Par value/face value Coupon Rate Coupon/ coupon payment Maturity (maturity date) Yield to maturity Discount and Premium bonds Collateral Sinking fund Call provision Call premlum Call protection Bond rating Types of bonds Secured bonds Mortgage bonds Debentures Putable bonds
10. A callable corporate bond can be purchased by the bond issuer before maturity for a price specified at the time the bond is issued. Corporation X issues two bonds (bond A and bond B) at the same time with the same maturity, par value, and coupons. However, bond A is callable and bond B is not. Which bond will sell for a higher price and why? (a) Bond B; bond A should have the value of bond B minus...
1st blank options = par value, coupon payment, price
2nd blank options = bankruptcy, default, liquidation
3rd blank options = convertible provision, sinking fund
provision, call provision
4th blank options= call provision, call premium,
convertibility provision
5th blank options = floating-rate, fixed-rate
6th blank options = indenture, trustee, debenture
7th = multiple choice
1. Characteristics of bonds To be effective issuing and investing in bonds, knowledge of their terminology, characteristics, and features is essential. For example: • A bond's_ par...
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