Discuss bonds as investments

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1. Discuss bonds as investments.

2. “An inverted yield curve is a good predictor of US recessions”. Discuss the validity of this statement and explain in detail your reasoning.

3. Corporations prefer bonds over preferred stock for financing their operations because

A. preferred stocks require a dividend.

B. bond interest rates change with the economy while stock dividends remain constant.

C. the after-tax cost of debt is less than the cost of preferred stock.

D. none of these.

Reference no: EM131299983

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