quizlet a bond having a call feature a) must be redeemed before the bond matures. b) is guaranteed not to be redeemed before mat

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quizlet a bond having a call feature a) must be redeemed before the bond matures. b) is guaranteed not to be redeemed before mat

urity. c) can be redeemed before maturity at the issuer's option. d) can be redeemed before maturity at the bond holder's option.

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1 answer:

Vladimir [108] · Answer 1 · 2024-03-06T09:05:30+03:00

A bond having a call feature can be redeemed before maturity at the issuer's option.(option c)

<h3>What is a call feature?</h3>

A bond is a debt instrument used by firms to raise capital. Bondholders are paid interest at regular intervals and are paid the amount invested at the bond's maturity.

A call feature on a bond gives the holder of the call option the right but not the obligation to buy a bond at a prespecified price. Call options can be redeemed before its maturity. The holder of a call is bullish.

For example, if an investor buys a call on a bond with a strike price of 100. If the current price of the bond is 90. The investor has the right to buy the bond if the bond rises to at least 100.

To learn more about call options, please check: brainly.com/question/17284643

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