Asked by Ethan Scofield on May 12, 2024
Verified
A bond that can be retired prior to maturity by the issuer is a(n) ____________ bond.
A) convertible
B) secured
C) unsecured
D) callable
E) Yankee
Callable Bond
A type of bond that can be redeemed by the issuer before its maturity date, typically at a premium price.
Convertible Bond
A type of bond that can be converted into a predetermined amount of the company's equity at certain times during its life, usually at the discretion of the bondholder.
Yankee Bond
A bond issued in the United States by foreign banks and corporations, denominated in U.S. dollars.
- Recognize and distinguish among diverse categories of bonds according to their safety, function, and characteristics.
Verified Answer
KS
Khamryn Simon-McdonaldMay 16, 2024
Final Answer :
D
Explanation :
Callable bonds give the issuer the right to retire the debt before its maturity date, usually at a specified call price. This feature allows issuers to refinance debt if interest rates decline.
Learning Objectives
- Recognize and distinguish among diverse categories of bonds according to their safety, function, and characteristics.