“You should never compare cash flows occurring at different times without first discounting them to a common date.” Why? Explain the problem if you do not.

“When the market interest rate exceeds the coupon rate, bonds sell for less than the face value.” Why? Should such a condition preclude you from buying that bond? Why?

“Financial leverage” and “financial risk” Then it states “Debt finance does not affect operating risk but it does add financial risk.” Using these two terms explain why the statement is true and provide two specific examples.

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You should never compare cash flows occurring at different times without first discounting them to a common date Why Explain the problem if you do not ... View the full answer