5. Types of bonds Aa Aa Fixed-income securities consist of debt instruments and

Question

5. Types of bonds Aa Aa Fixed-income securities consist of debt instruments and preferred stock. Bonds are debt securities in which a borrower promises to pay a specified interest rate and principal at a future date. The entity that promises to make the interest and maturity payments for a bond issue is called the Based on the information given in the following statement, answer the questions that follow: New York City issued a general obligation bond for a canal in 1812. It was the first formal debt instrument with a fixed repayment schedule issued by a city What type of bonds are these? Who is the issuer of the bonds? O Municipal bonds O Corporate bonds Treasury bonds Federal Reserve Bank of New York O Bank of New York O The New York City government

Explanation / Answer

The entity that promises to make the interest and maturity payments for a bond issue called the ISSUER.

2nd ques.

Municipal bonds

(since New York city issued these bonds to finance a canal project).

3rd. ques.

The NewYork city government is the issuer of bonds.

(neither Federal reserve of Bank of New York nor Bank of new york issued the bonds).

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