Capital structure arbitrage strategies attempt to capitalize on relative price-movement discrepancies observed between the debt and equity securities of an individual company. Such strategies are most effective during periods of:
　　A. High volatility and rising equity markets.
　　B. High volatility and falling equity markets.
　　C. Low volatility and falling equity markets.
　　D. Low volatility and rising equity markets
　　Answer:B
　　During periods of high volatility and falling equity markets, debt holders tend to realize the gravity of a company's debt load before equity holders and adjust the prices of the company's bonds before equity holders adjust the company's stock price.