AFP
CTP · Question #344
CTP Question #344: Real Exam Question with Answer & Explanation
The correct answer is A. Zero-coupon bond. See the full explanation below for the reasoning.
Question
- (Topic 4) XYZ Company is interested in issuing a bond to finance a new venture opportunity. The new venture is not expected to generate any cash flow for several years. Because of this, XYZ Company would prefer to issue a bond that does not require interest payments. What type of bond should XYZ Company issue?
Options
- AZero-coupon bond
- BMunicipal bond
- CTender option bond
- DHigh-yield bond
Community Discussion
No community discussion yet for this question.