Which of the following statements about sinking fund is NOT true?
Sinking fund provision facilitates the orderly retirement of the bond issue.
A company would prefer to use sinking fund to call bond if interest rate is below the coupon rate.
A company would use sinking fund to call bond if interest rate is well above coupon rate.
It is a good strategy for a firm to use its sinking fund to call bond if bond sells at a big premium.
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