Which of the following statements is correct?
(a) bonds are generally regarded as being riskier than common stocks, and therefore bonds have higher required returns.
(b) the market price of a bond will always approach its par value as its maturity date approaches, provided the bond's required return remains constant.
(c) if the federal reserve unexpectedly announces that it expects inflation to increase, then we would probably observe an immediate increase in bond prices.
(d) the total yield on a bond is derived from dividends plus changes in the price of the bond.
(e) bonds issued by larger companies always have lower yields to maturity (due to less risk) than bonds issued by smaller companies.
the answer's b $16.80
the answer is: a) to reflect the current business environment
pro forma financial statement refers to the financial statement that is made based on assumption or projection. this mean that the financial planning is made based on how the future would look like according to our own opinion.
current business environment cannot be considered as pro forma financial statement because it represent the situation that already happen. we does not need any projection to state current business environment.
(a) bonds are generall...