Evaluate the decision of a company to issue bonds at a discount when the market interest rate is higher than the stated rate. What are the potential benefits and drawbacks?

• A. Issuing bonds at a discount can attract investors despite a lower stated rate, but it results in receiving less cash upfront.
• B. Issuing bonds at a discount has no impact on investor attraction or cash received.
• C. Issuing bonds at a discount results in receiving more cash upfront but may deter investors.
• D. Issuing bonds at a discount ensures receiving more cash upfront and attracts more investors.

Answer: (A)