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Which of the following is/are true? I. Maturity risk premium is larger for industrial bonds than it is for Treasury bonds. II. Preferred stock dividends
Which of the following is/are true? I. Maturity risk premium is larger for industrial bonds than it is for Treasury bonds.
II. Preferred stock dividends per share are normally not increased as the earnings of the firm increase.
III. The major advantages of long-term debt include the one that owners are able to maintain control.
IV. The basic relationship in bond valuation is for a given percentage change in required rate of return, the longer the time to maturity, the larger the change in bond value.
A. I & IV
B. I, II, III, and IV
C. II, III & IV
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