As CFO of your corporation, you would prefer (all else equal)to see the price of your corporation's bonds
A)increase, indicating that bond investors view your firm as less risky.
B)decrease, indicating that bond investors view your firm as less risky.
C)increase, indicating that bond investors view your firm as more willing to take risks.
D)decrease, indicating that bond investors view your firm as more willing to take risks.

Question

Quizplus · Accepted Answer

As CFO, you would want bond investors to view your firm as less risky, which would lead to an increase in the price of your corporation's bonds. This would allow your corporation to potentially issue bonds in the future at a lower interest rate, lowering the cost of borrowing for the corporation.

As CFO of Your Corporation, You Would Prefer (All Else