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279. Issuing bonds to obtain long-term funds legally compels a firm to pay regular ________
payments and repay the ________ at the maturity date.
280. The cost of a firm borrowing money is called the:
281. Another name for the fixed rate of interest attached to a bond is the:
282. A bond's
face value
is the same as its:
283. Government bonds can vary in denomination, but most corporate bonds are issued in
___________.
284. Which of the following accurately describes an advantage of selling bonds to raise long-
term capital?
285. Issuing ________ increases a firm's debt and may adversely affect the financial
community's perception of the firm.
286. An unsecured bond, backed only by the well-respected name of the organization, is called
a _________ bond.
287. Corporations issuing ________ bonds pledge a tangible asset as collateral to reduce the
risk incurred by a bondholder.
288. Firms establish a ________ so that sufficient funds are available to repay bondholders on
the maturity date.
289. By issuing bonds with a _______, the corporation retains the right to pay off the bond prior
to the maturity date.
290. By buying a ________ bond, investors will have an option to exchange their bond for
shares of common stock in the company at a future date.
291. According to the Standard & Poor's Investor Services ratings, which of these ratings
indicates a highly speculative bond?
292. Which of the following represents a disadvantage of issuing bonds?
293. Bonds perceived as high risk typically pay ________ interest rates.
294. The investor will receive the face value of the bond on the ________ date.
295. Which of these represents a special feature included with some bond issues?
296. A convertible bond allows the bondholder to exchange the bond for:
297. Seattle Music, Inc., recently offered bonds for sale to the public. The unsecured corporate
bond paid interest of 9% to investors for the twenty-year life of the bonds. Seattle Music is
obligated to:
298. As your elderly Uncle Bill approaches retirement, he asks for your advice for a safe place
to invest several thousand dollars. He wants to receive some kind of payment each year for
investing his money without a great deal of risk. You explain:
299. The ABC Corporation issues a $1,000 bond, with an interest rate of 10%, and a maturity
date of 2025. This creates a liability for the ABC Corporation to pay the bondholder:
300. Moody's Investor Service currently rates the Sasha Deal Corporation bonds as a C grade.
This indicates that these bonds are:
301. Ebony Enterprises decides to pay off its bonds several years before the maturity date.
Apparently, the bonds _____________.
302. Wyoming Mining Corporation makes regular monetary deposits that will accumulate and
provide for an orderly retirement of their bonds when they come due in 2025. Wyoming Mining
appears to be utilizing a:
303. Maplewood Toy Company hopes to raise long-term capital by promising in writing to
repay the principal provided by potential creditors in ten years. Additionally, the certificate issued
by Maplewood promises to pay 5% interest annually for the ten-year life of the security.
Maplewood intends to issue:
304. After owning a Cordero Company bond for five years, Gabrielle exercised an option that
allowed her to exchange her bond for 20 shares of the company stock. Gabrielle owned a:
305. Juan recently invested in 15-year Bellandro Bay Brewery bonds paying 6% interest
annually, with a maturity date of 2030. The bonds are callable in 2025. If interest rates go down
to 4.5% in the year 2025, the brewery is likely to:
306. Investors buying bonds and corporations issuing bonds (both) accept investment risk.
Which of the following statements is most correct when it comes to the investment that one or
the other party accepts?
307. A ________ is a registered representative acting as an intermediary to buy and sell
securities for clients.
308. When an investor places a buy order with a stockbroker, the broker contacts a(n)
__________ to complete the transaction.
309. Investors trading online:
310. Investing online is usually ________ than trading through a traditional stock brokerage
firm.
