Which of the following would you expect to offer the highest interest rate, all else equal?
A)a convertible bond
B)a callable bond
C)a putable bond
D)a collateralized bond

Question

Quizplus · Accepted Answer

Callable bonds typically offer higher interest rates compared to other types of bonds because the issuer retains the right to repay the bond before its maturity date, which is a disadvantage for investors in a declining interest rate environment. To compensate for this risk, issuers offer a higher interest rate.

Which of the Following Would You Expect to Offer the Highest