Question: a. In an efficient market, callable and non-callable bonds will be priced so that there will be no advantage or disadvantage to the call provision.

a. In an efficient market, callable and non-callable bonds will be priced so that there will be no advantage or disadvantage to the call provision. Comment.

b. If interest rates fall, will the price of non-callable bonds move up higher than that of callable bonds? Why or why not?

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