ch 10 fun3244

ch 10 fun3244 - Bonds= Principal=On a bond the amount of...

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Bonds= Principal=On a bond the amount of capital that must be repaid at maturity. Maturity date=The date on which a bond matures and the principal must be paid. Term bond= A bond that has a single fairly lengthy maturity date. Serial bond= A bond that has a series of different maturity dates. Note=A debt security originally issued with a maturity from 2 to 10 years. Premium bond=A bond with a market value in excess of par value. Occurs when the interest rates drop below the coupon rate. Discount bond=A bond with a market value lower than the par value. Occurs when interest rates drop below the coupon rate. Call premium=The amount added to a bonds par value and paid to investors when a bond is retired prematurely. Call price= The price the issuer must pay to retire a bond prematurely. Equals par value plus the call premium. Senior bonds=Secured debt obligations backed by a legal claim on specific property of the issuer. Mortgage bonds= A bond secured by a mortgage on one or more assets. These bonds are
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ch 10 fun3244 - Bonds= Principal=On a bond the amount of...

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