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Question 22 1 pts Corporation X issues three bonds, A, B, and C, with the same par value, coupon rate, seniority, and maturity. Bond A
Question 22 1 pts Corporation X issues three bonds, A, B, and C, with the same par value, coupon rate, seniority, and maturity. Bond A is convertible, that is it can be exchanged by the bond holder for a specified number of shares of X's stock. Bond B has no special features. Bond C is callable for 105% of par value, that is X can buy back the bonds for 105% of par value at any time. Rank the bonds from highest to lowest in order of their value to investors. O A,B,C O B,A, C O C,A,B O B,C,A O A,C,B Question 21 1 pts Which of the following is false about agency mortgage-backed securities? O They have very high default risk O They offer investors an ability to invest in a diversified pool of mortgages O They are more liquid than non-agency mortgage-backed securities O They are more liquid than high-yield corporate bonds Question 20 1 pts Company X would like to issue bonds to finance the purchase of a new factory, but they are having financial difficulties, negatively impacting the credit rating of their existing bonds. Which of the following options could they realistically have to issue new bonds at a favorable interest rate? O Pledge the new factory as collateral for the new bonds O Default on the existing bonds O Let the new bonds be senior to the old bonds O Issue bonds without promising any collateral, but market the fact that the new factory is projected to substantially increase profitability
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