If a company is wanting to lessen the cost of a new security by imbedding a valuable option in the security,then the company is most likely to issue

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Convertible debt allows the investor to convert their debt into equity (usually common stock) at a future date. By offering a valuable conversion option, the company can entice investors to buy the debt and lower the overall cost of the security. This is a common strategy used by companies looking to raise capital while minimizing expenses. Common stock (A) and preferred stock (D) do not typically have embedded options, and issuing debt (B) without any added value would not provide any cost-saving benefits.

If a Company Is Wanting to Lessen the Cost of a New