Question: 1. For a corporation, what are the advantages of corporate bonds over long-term loans?
2. Describe the three methods used to ensure that funds are available to redeem corporate bonds at maturity.
3. During the recent financial crisis, many financial managers and corporate officers have been criticized for
(a) poor decisions,
(b) lack of ethical behavior,
(c) large salaries,
d) lucrative severance packages worth millions of dollars, and
(e) extravagant lifestyles. Is this criticism justified? Justify your opinion.