What causes a gain or loss on the sale of a bond investment? Group of answer choices when the selling company negotiates a better price when the selling price of the bond differs from the book value (cost) of the bond when the selling company has unamortized discounts when the selling company has unamortized premiums

Q: Which theory of the term structure proposes that bonds of different maturities are not substitutes…

A: Holding money in the form of cash has the benefits of providing liquidity and meeting transactional…

Q: which of the below has a negative correlation with the return on bonds ? a. Taxability b. Default…

A: Bonds is fixed income instrument that represent that loan provide by investor to borrower. Following…

Q: What is the cost of equity based on the own-bondyield-plus-judgmental-risk-premium method?

A: Answer: Bond-yield-plus-judgemental-risk-premium method involves adding a judgemental risk premium…

Q: Why do noninvestment-grade bonds have much higher direct costs than investment-grade issues?

A: Bond: Bond is a kind of debt instrument typically issued by corporations, government organizations…

Q: What economic circumstances might encourage investors to use a bond's convertibility feature

A: This question outlines how current economic conditions may encourage investors to use a bond's…

Q: How does the decision to use debt involve a risk-versus-return trade-off?

A: Risk return trade off: If an investment has high risk, the investors expect more returns from it. If…

Q: The realized gain (loss) on sale of debt investments with an objective of collecting contractual…

A: Realized Gain: When an investment is sold for a greater price than it was originally acquired, this…

Q: What causes a gain or loss on the sale of a bond investment?

A:

Q: what economic conditions would prompt investors to take advantage of a bond's convertibility feture?

A: Convertible bonds are a type of instrument which gives the investors the facility of converting its…

Q: Explain the differences between a bond's yield to maturity (YTM) and its yield to call (YTC). Is…

A: Introduction: The following are the distinctions between the yield to maturity and the profit to…

Q: What is the mispricing if an Equity Premium exists? Should more bonds or more equity be added to a…

A: Let's revisit the Equity Premium Puzzle (EPP) and explore its implications without any external…

Q: What is a bond spread and how is it related tothe default risk premium? How are bond ratingsrelated…

A: Bond spread: It is the difference between the yields of two bonds.

Q: What does it mean to amortize a bond premium or discount? Why is it necessary?

A: Introduction: A bond is a contract between the bond lender and the bondholders. The two most common…

Q: What is the straight-line amortization approach with regards to a bond discount or premium?

A: Bond with a straight-line amortization schedule: The straight-line amortization technique is a way…

Q: Why does the same bond buy or sell at different prices?

A: The pricing of bonds can vary even if they are the same because of several factors that influence…

Q: Explain the use of a sinking-fund provision. How can it reduce the investor’s risk?  What are…

A: 1.  Sinking funds adds an element of safety for corporate bond issue to investors. Sinking fund…

Q: Which of the following is the best explanation of what the call premium is?   Group of answer…

A: Call premium refers to the amount over (above) the par value of a share or bond which is payable to…

Q: Which  of the following statements is correct in regard to trading bond investment? a. Trading bond…

A: Introduction: Trading securities: Buying and selling of any financial securities called as Trading…

Q: explain how fluctuating market interest rates impact the price of a bond being sold on the secondary…

A: Bonds represent the liability for the company that is posted under the head non current liabilities…