Asked by Shatha Zaghloul on May 05, 2024
Verified
A bond which, at the election of the holder, can be swapped for a fixed number of shares of common stock at any time prior to the bond's maturity is called a _______________ bond.
A) Zero-coupon
B) Callable
C) Putable
D) Convertible
E) Warrant
Convertible Bond
A kind of debt security that allows for conversion into a fixed number of shares of the company issuing it, usually at the choice of the person holding the bond.
Common Stock
A type of security that signifies ownership in a corporation and represents a claim on part of the company's profits or losses.
- Identify the critical roles of call, sinking fund, and convertible options within bonds.
Verified Answer
ZK
Zybrea KnightMay 07, 2024
Final Answer :
D
Explanation :
Convertible bonds are those that can be converted into a predetermined amount of the issuing company's equity at certain times during the bond's life, usually at the discretion of the bondholder.
Learning Objectives
- Identify the critical roles of call, sinking fund, and convertible options within bonds.