Why might a company choose to raise money through bonds, rather than take out a note payable or issue stock? What are the advantages and disadvantages of bonds? What does it mean to issue a bond at a "premium" or at a "discount"?

Q: Why does the entire issue price of convertible bonds is recorded as debt?

A: A convertible bond is a type of bond that the holder can convert these bonds into a specified number…

Q: What are the main advantages and disadvantages of            investing in bonds?

A: Bonds are debt instruments issued by an entity. The issuing entity can either be a corporate entity…

Q: What are the more recently issued (and more frequently traded) bonds called? Why do investors favor…

A: The more recently issued (and more frequently traded) bonds are called Treasury Bonds which are…

Q: Why would a company choose to issue bonds instead of issuing stock?

A: Concept:

Q: Why would the company redeem the bonds prior to the maturity date if they were going to recognize a…

A: A bond appears to be a debt owing to a firm or government that pays holders a predetermined interest…

Q: Is bond financing risky or safe for a company? Explain in details. Why bond investing safer for…

A: Bond financing is a sort of long-term borrowing that is Particulary used by  various state and…

Q: Define junk bonds and explain how junk bonds became an important factor in corporate bond market.

A: The corporation and government can raise finance by issuing bonds. The borrower i.e bond issuer is…

Q: In which market environment does the issuance of a callable bond make more sense from a corporate…

A: A bond is a debt security that is sold by a business entity to borrow long-term funds. Generally,…

Q: If a new competitor with scale enters, does that increase, decrease, or have no effect on the credit…

A: solution concept credit spread                 The term Credit spread is widely used while assessing…

Q: When CDS spreads on the company widen, does that increase, decrease, or have no effect on the credit…

A: Answer are as follows.

Q: When a company exercises its call provision on bonds, the company pays the book value of the bonds…

A: Call provision on the bond is the option held by the issuer for redeeming back the bonds if in case…

Q: Explain what a corporate bond is b. Outline the characteristics of the bond market d. Explain the…

A: A company can raise capital and secure financing through different mediums of debt and equity.…

Q: One of several reasons that companies might choose to issue bonds is to shift their capital…

A: Bonds are the liability for the company and its issue increases the borrowings. Whereas, equity…

Q: Which of the following are traded in money markets? banker’s acceptances all Treasury securities…

A: Money market instrument means those instrument which are issued in money market and generally for…

Q: Discuss the effect if a company’s bond is downgraded.

A: Downgraded Bond: Credit rating agency are downgrading rating ofthe company's bond when their is risk…

Q: What does it mean when a company calls a bond?

A: Bonds: Bonds are long-term promissory notes that are issued by a company while borrowing money from…

Q: Why do most municipal bonds pay lower interest than riskless Treasury bonds?

A: Municipal as well as Treasury bonds are backed by the government and therefore are less risky. The…

Q: What are stock warrants and convertible debt? How do stock warrants work? How does convertible debt…

A: Stock warrant (SW) is a contract through which investors get rights to purchase the particular…

Q: What are the advantages and disadvantages of investing in stocks vs bonds

A: Investing in stocks has the following risk: Unlike bonds, investment in common stocks does not…

Q: If you are an investor will you choose to investment in bonds? Why?

A: Bond is a debt security.

Q: What are the pros and cons of a company’s decision to issue stock versus issuing bonds?

A: Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money…

Q: Will you choose to invest in bonds if you are an investor? Why?

A: A bond is a long-term investment instrument that requires a corporation to return the amount of the…

Q: Discuss the functioning and merits of callable and puttable bonds from an investor’s perspective

A: “Since you have posted multiple questions, we will solve first question for you. If you want any…

Q: issurance of convertible bonds to be an attractive form of financing

A: Financing:- Financing means to provide money to someone for a particular rate of Interest. This is a…

Q: Why would a company typically choose to source external financing by issuing bonds rather than…

A: Bonds are debt instruments that are used by institutions to raise capital. The face value and the…

Q: Why might the company choose to make the bonds convertible into common stock?

A: Bonds:   A bond is a financial instrument for raising debt as it is called a debt instrument. It…

Q: What are convertible bonds

A: Bonds are financial instruments which provides fixed returns to its holders. Bonds actually, have a…

Q: Which of the following is true of a discount on bonds payable?   it is a contra-stockholders’…

A: Interest paid on bonds consists of two components: Interest expense and Discount on bonds payable…

Q: What are the reasons for issuing convertible bonds rather than straight debt?

A: Convertible bonds: Convertible bonds are a kind of bonds that can be easily converted into…

Q: How can we determine if the problem or scenario involves or illustrates stocks or bonds? What…

A: Answer to question no : 4 *Basically stocks are the equity market linked to a particular index of a…

Q: Identify the following as either an advantage (A) or a disadvantage (D) of bond financing for a…

A: Definition: Bonds are a kind of interest-bearing notes payable, usually issued by companies,…

Q: As a bondholder, what risks would you face, and how are these risk factors lower for bonds than they…

A: Bond:  A bonds area unit is typically thought to be a secure investment. Bonds are unit monetary…

Q: Why would an individual invest in bonds rather than stock

A: A bond is a fixed income instrument that depicts a loan made by the issuer to the borrower. These…

Q: What is a "call" provision? Why would bond issuers exercise this? Why would bond investors choose to…

A: Certain companies issue bonds with a 'call' provision.

Q: What is a bond?

A: Hey, since there are multiple questions posted, we will answer first question. If you want any…

Q: What is the difference between shares and bonds from the perspective of an investor

A: Institutional investors are high net worth institutions who invest in stocks for the purpose of…

Q: Defining common stock yield and its importance to investors Define and explain a bond yield's…

A: "As per the policy of our company, we are allowed to answer only the first three sub-parts in case…

Q: t are the advantages and disadvantages of buying bonds directly?

A: A bond is a fixed-income instrument that represents an investor's loan to a borrower (typically…

Q: Which of the following is not a Money Market Instruments? a. Corporate Bonds b. Bankers’ Acceptance…

A: Answer shares and bonds having maturity of more than one year are not considered as money market…

Q: Which of the following is correct?   A. Bonds maturing at a specified single date are called…

A: Bonds are fixed income earning instruments where the investor lends money to the company in exchange…

Q: If bonds payable are not callable, the issuing corporation a.can exchange them for common stock…

A: Solution: When bond are callable, the issuing corporation can redeem the bond at a specified price…