Bonds

Front

What is a bond?

Back

A long-term loan from investors to the issuer

Front

Which of the following is not a typical bond issuer? Government, Municipalities, Individuals, Corporations

Back

Individuals

Front

True or False: Government bonds are considered riskier than corporate bonds.

Back

FALSE

Front

If the market interest rate increases, bond prices will:

Back

Decrease

Front

Which type of borrowing is typically used for short-term financing? Bonds, Bank loans, Equity, Stock

Back

Bank loans

Front

What is the maturity date of a bond?

Back

The final repayment date

Front

What does the term of the bond refer to?

Back

The time remaining until maturity

Front

True or False: Coupon payments are fixed for the life of the bond.

Back

TRUE

Front

A 1,000 € bond with 10% coupon rate paid semiannually pays how much per payment?

Back

50 €

Front

Why are zero-coupon bonds sold at a discount?

Back

Because they don’t pay interest