If a bond has a call provision, this will tend to:

If a bond has a call provision, this will tend to:



A) place a floor on how low the price will decline.

B) have no effect on the price.

C) make the bond less attractive to investors because a call would terminate the interest payments.

D) make the bond more attractive to investors because most bonds are called at a premium



Answer: C) make the bond less attractive to investors because a call would terminate the interest payments.


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