__A bond that has a call provision provides more risk to the ___________ of getting paid off early when reinvestment rates for the same type of bond would be lower.

a.bond issuer

b.bond investor

c.government

d.community

Is it the answer A?

True and false

1.____The par value of common stock historically serves the purpose as being a minimum

amount for which a share of a corporation's stock must be sold.

2.____ The market price of a corporation's shares is not always equal to the book value of

the shares (original value for which the shares were sold).

3.____ A bond with a call provision enables the issuer to refinance the amount borrowed by

the bond issuer at a lower rate when market rates go down.

4. ____ The annual return may only be calculated for stock, not bonds.

5.____A cash deficit unit is a party that needs financing (debt or equity) from the financial

markets.

6. ____ One of the risks of borrowing money is the possibility of not being able to pay it back

as agreed.

7.____If a financial security has higher risk than another security, the investor in the high-

risk security expects a higher return than that for the comparatively

low-risk security.