During the reading of the textbook there is a section about call provision. This is when a corporation has the right to call the bonds for redemption. The book says that that the company must pay the bondholders an amount great than the par value if they are called. They usually do this if interest rates drop. The reason being is that bonds and interest rates have an inverse relationship. After the company calls the bonds they will issue out other bonds at a lower interest rate. Why would investors invest in callable bonds if companies can just call them back (after a certain amount of time) and issue out others bonds with lower interest rates?