When a bond indenture includes a sinking fund provision（）.

lines more than the price of Bond B.Compared to Bond B, Bond A most likely:

A.is callable.

B.has a lower coupon.

C.has a shorter maturity.

Bao Capital issed a 5－year, $50 million face, 6% semiannual bond when market interest

Bao Capital issed a 5-year, $50 million face, 6% semiannual bond when market interest rates were 7%.The market yield of the bonds was 8% at the beginning of the next year.What is the initial balance sheet liability, and what is the interest expense that the company should report for the first half of the second year of the bond’s life (the third semiannual period)”

A.below the coupon rate when the bond sells at a discount, and equal to the coupon rate when the bond sells at a premium.

B.the discount rate that will set the present value of the payments equal to the bond price.

C.based on the assumption that any payments received are reinvested at the coupon rate.

D.none of the above.

E.A, B, and C.

A.zero.

B.$14.87.

C.$45.85.

D.$7.44.

E.none of the above.

When interest rates fall, the price of a callable bond will:

A.rise more than an option-free bond.

B.rise less than an option-free bond.

C.fall less than an option-free bond.

When you make a _______, you should always try to fulfill it.

A) abuse

B) bond

C) estimate

D) pledge

a coupon rate of 10%.The market interest rate is 11% when the bond is issued.The balance sheet liability at the end of the first semiannual period is closestto:

A.$9,650,700.

B.$9,683,250.

C.$9,715,850.

Bao Capital issed a 5-year, $50 million face, 6% semiannual bond when market interest rates were 7%.The market yield of the bonds was 8% at the beginning of the next year.What is the initial balance sheet liability, and what is the interest expense that the company should report for the first half of the second year of the bond’s life (the third semiannual period)”