Question: 1. Distinguish between debentures and mortgage bonds.
2. Define (a) Eurobonds, (b) zero coupon bonds, and (c) junk bonds.
3. Describe the bondholder's claim on the firm's assets and income.
4. a. How does a bond's par value differ from its market value?
b. Explain the differences among a bond's coupon interest rate, current yield, and required rate of return.
5. What factors determine a bond's rating? Why is the rating important to the firm's manager?
6. What are the basic differences among book value, liquidation value, market value, and intrinsic value?