Why bondholders often prefer a sinking fund provision

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Reference no: EM131338571

1. In what ways is preferred stock similar to long-term debt? In what ways is it similar to common stock?

2. Explain why bondholders often prefer a sinking fund provision in a bond issue.

3. Explain what is meant by interest rate risk.

4. Explain how a bond can be classified as a fixed-income security when the yield to maturity can fluctuate significantly over time, depending on the market price of the bond.

Reference no: EM131338571

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