Which of the following statements is FALSE regarding a call provision?
A)The issuer can repurchase a fraction of the outstanding bonds in the market or it can make a tender offer for the entire issue.
B)A call provision allows the issuer to repurchase the bonds at a predetermined price.
C)The call price is generally set at or below,and expressed as a percentage of,the bond's face value.
D)A call feature allows the issuer of the bond the right (but not the obligation)to retire all outstanding bonds on (or after)a specific date (the call date),for the call price.

Question

Quizplus · Accepted Answer

The call price is generally set above, not at or below, the bond's face value. This price is often expressed as a percentage of the face value, and can be higher or lower depending on market conditions and the terms of the bond agreement.

Which of the Following Statements Is FALSE Regarding a Call