Question: True or False and why? 1. A call provision gives the issuer the right to all the bonds for redemption. In general, companies call bonds

True or False and why?

1. A call provision gives the issuer the right to all the bonds for redemption. In general, companies call bonds if interest rates rise and do not call them if interest rates decline.

2. A zero coupon bond is a bond that pays no interest and is offered (and initially sells) at a discount. These bonds provide compensation to investors in the form of capital appreciation.

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