ЁЯУв Too many exams? DonтАЩt know which one suits you best? Book Your Free Expert ЁЯСЙ call Now!

    Question

    Which of the following is incorrect about FFCB (Foreign

    Currency Convertible Bond)? i. Issued by an Indian listed company in overseas market. ii. It’s a debt instrument iii. FCCBs appear on the liabilities side of the issuing company's balance sheet.
    A 1) Only i Correct Answer Incorrect Answer
    B 2) Only i & ii Correct Answer Incorrect Answer
    C 3) Only i & iii Correct Answer Incorrect Answer
    D 4) Only ii Correct Answer Incorrect Answer
    E 5) None of these Correct Answer Incorrect Answer

    Solution

    FCCB is a Quasi-debt instrument because there is an option of converting the bonds into equity at a price determined at the time the bond is issued. As debt-instrument it ensures minimum guaranteed returns for the investor. Normally FCCBs have a maturity period of about five years during which no call or put option can be exercised.

    Practice Next
    More Economy Questions

    Relevant for Exams:

    ask-question