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Investing - Unit 6
Investing - Bonds
| Question | Answer |
|---|---|
| Similar to an I.O.U. When you buy a bond, you make a loan to a government or a corporation in return for promised repayment at a specified rate of interest. | Bond |
| A bond that pays out interest at fixed intervals (usually six months) over the time the bond is held by the investor. | Coupon Bond |
| The price an investor pays for a bond (also called Par Value or Principal) | Face Value |
| An investment in which the amount of income an investor receives is set, or fixed, by the issuer. | Fixed Income Security |
| The entity (government or corporation) that writes the bond purchased by investors. | Issuer |
| The date at which the bond matures and the final payment is made to the investor. | Maturity Date |
| A bond issued by state or local governments. | Municipal Bond |
| The interest payment on a coupon bond. | Coupon |
| THe price an investor pays for a bond (also called face value or principal) | Par Value |
| The initial cost of the bond (also known as the par value or face value of the bond) | Principal |
| A bond whose purchase price is below face value. One payment is made at maturity that includes the principal plus accumulated interest. | Zero-Coupon Bond |
Created by:
mryan396
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