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UPSC Civil ServicesPrelims2022General Studies Paper I
Question
QQ65. With reference to Convertible Bonds, consider the following statements : 1. As there is an option to exchange the bond for equity, Convertible Bonds pay a lower rate of interest. 2. The option to convert to equity affords the bondholder a degree of indexation to rising consumer prices. Which of the statements given above is/are correct ?
Options
- A 1 only
- B 2 only
- C Both 1 and 2
- D Neither 1 nor 2
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Correct Answer
C Both 1 and 2
Model Answer
Answer: option C, as per UPSC's final answer key (Series A).