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When a firm refunds a debt issue, the firm’s stockholders gainand its bondholders lose. This points

When a firm refunds a debt issue, the firm’s stockholders gainand its bondholders lose. This points

When a firm refunds a debt issue, the firm’s stockholders gainand its bondholders lose. This points out the risk of a callprovision to bondholders and explains why a non-callable bond willtypically command a higher price than an otherwise similar callablebond.TrueFalseThe cost of meeting SEC and possibly additional state reportingrequirements regarding disclosure of financial information, thedanger of losing control, and the possibility of an inactive marketand an attendant low stock price are potential disadvantages ofgoing public.TrueFalseYou have the following data on three stocks:Stock Standard Deviation BetaA 0.15 0.79B 0.25 0.61C 0.20 1.29As a risk minimizer, you would choose Stock ____ if it is to beheld in isolation and Stock ____ if it is to be held as part of awell-diversified portfolio.A; B.C; A.B; C.C; B.