Practice Quiz

FINRA Series 7

Category - Series 7

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In a competitive bidding for mortgage bonds of a large public utility the winning underwriter is determined by:
  1. the highest dollar amount paid to the issuer
  2. the lowest net interest cost to the issuer
  3. the shortest maturity date for the bonds
  4. the refunding and sinking fund terms in the indenture
Explanation
Answer: B - the lowest net interest cost to the issuer. All competitive bids are based upon the lowest interest cost.
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