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need help with question 2 Ranger Inc would like to issue new 20 -year bonds. Initially, the plan was to make the bonds non-callable. If
need help with question 2
Ranger Inc would like to issue new 20 -year bonds. Initially, the plan was to make the bonds non-callable. If the bonds were made callable after 5 years at a 5% call premium, how would this affect their requred rate of return? There is no reason to expect a change in the requred rate of returu The required rate of retum would decline because the bond would then be less risky to a bondlolder The required rate of return would increase because the bond would then be more nsky to a bondholder. It is impossible to say without more information. Because of the call premium, the requifing rate of return would decline Step by Step Solution
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