Question 6 1 pts Ip 446-452] The \"bond issuer\" issues bonds to raise money; th

Question

Question 6 1 pts Ip 446-452] The "bond issuer" issues bonds to raise money; the bonds must eventually be redeemed (paid back). The "bond investors" loan money to the issuer when they buy the bonds; their loan will be repaid when the bonds are redeemed at maturity. (Some bonds might be redeemed before maturity.) Typically, the contract between the bond issuer and the bond investors is many pages long and full of complex, legal language. Among other things, this complex document identifies the rights and obligations of the respective parties. This agreement is called a(an): O Promissary note O Bond indenture O Mortgage agreement O Amortization contract

Explanation / Answer

Question 6). Answer :- Option B). Bond indenture.

Explanation :- The agreement specifying all the terms and conditions of bond issue, date of interest payments on bond, special features of bond, rights and obligations of parties to the bond (bond issuer and bond investor) etc. is referred to as the bond indenture.

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