a. What is the purpose of bond seniority provisions?

b. After a call protection period has elapsed, why is the call price an effective ceiling on the market price of a callable bond with a fixed-price call provision?

c. Suppose you hold a bond with a make-whole call provision. The coupon rate on this bond is 5.90 percent. At what yield to maturity will this bond sell for par?

d. Using Figure 18.1 as a guide, what would the price-yield relationship look like for a noncallable bond putable at par value?

e. Under what conditions would a put feature not yield an effective floor for the market price of a put bond?

f. Describe the conversion decision that convertible bondholders must make when the bonds mature.

g. For nonconvertible bonds, the call price is a ceiling on the market price of the bond. Why might the call price not be an effective ceiling on the price of a convertible bond?

h. For bond investors, what are some of the advantages and disadvantages of a sinking fund provision?

i. Why would a corporation voluntarily include protective covenants in its bond indenture contract?

j. How does an adjustable coupon rate feature affect the interest rate risk of a bond?

k. How might bondholders respond if the coupon rate on an adjustable-rate putable bond was set below market interest rates?