An issuer interested in reducing its interest cost can use the call provision to call in outstanding bond issues. The issuer is

Question

netineya [11]

3 years ago

8

An issuer interested in reducing its interest cost can use the call provision to call in outstanding bond issues. The issuer is

most likely to call bonds with

Business

1 answer:

Marta_Voda [28] · Answer 1 · 2022-09-11T13:50:52+03:00

Answer: high coupon and low call premium.

Explanation:

An issuer interested in reducing its interest cost can use the call provision to call in outstanding bond issues. The issuer is most likely to call bonds with a high coupon and low call premium.

Since we've been informed that the issuer is interested in reducing the interest cost and can use the call provision to call in outstanding bond issues, he or she should call in bonds with a high coupon and low call premium.