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The Call Provision on a bond allows the issuer of the bond to call the bond or to force the investor to sell the bond
The Call Provision on a bond allows the issuer of the bond to "call" the bond or to force the investor to sell the bond back to the issuer at or near its face value prior to the maturity date of the bond. Which of the following are FALSE statements with respect to the Call Provision? Multiple Choice Issuers are likely to exercise their call option when market interest rates are well below the coupon rate on the bond Bonds with call provisions are more risky to investors than otherwise identical bonds without the call provision Investors LIKE call options on bonds Investors don't like call options because they tend to get exercised when interest rates have fallen, forcing them to reinvest at a lower yield than they previously earned
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