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1.Is it true that only risk associated with the owning of a bond is that the issuer will not make all the payments? Explain. 2.

1.Is it true that only risk associated with the owning of a bond is that the issuer will not make all the payments? Explain.

2. What is the relationship between the WACC and the value of the firm?

3. What is the relationship between the WACC and the value of the firm under MMI?

4. How does the bond rating affect the corporate bond yield?

5. How does the expected rate of inflation affect nominal interest rates?

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