Failure to pay either the interest payments or the bond principle as agreed can cause a firm to go
into bankruptcy.
Correct Answer:
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Q1: Sinking fund provisions are included in the
Q6: Call provisions are included in the bond
Q8: Debt can be subordinated to equity.
Q9: Maintaining a current ratio of 1.5 or
Q10: For two bonds identical but for coupon,
Q11: All else the same, if interest rates
Q12: All else equal, the market value of
Q14: Maintaining a current ratio of 1.5 or
Q17: The call premium increases as the time
Q19: The repayment of the bond principle is
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