Question
Which of the following statements is most correct? a-The interest rate on a new issue of callable bonds is likely to exceed that on a
Which of the following statements is most correct? a-The interest rate on a new issue of callable bonds is likely to exceed that on a similar new issue of noncallable bonds. b-The interest rate on a new issue of noncallable bonds is likely to exceed that on a similar new issue of callable bonds. c-Noncallable bonds are riskier to the investor, while callable bonds are riskier to the issuer. d-There is no difference in risk to the investor between similar callable and noncallable bonds. e-The interest rate on a new issue of callable bonds is likely to be equal to that on a similar new issue of noncallable bonds.
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