Asked by Felicia Owunwanne on Jun 06, 2024
Verified
Bonds will always fall into which one of the following pairs of categories?
A) Secured or unsecured
B) Mortgage or sinking fund
C) Debenture or unsecured
D) Callable or convertible
Callable
Describes a financial security (like a bond) that can be redeemed or "called" by the issuer before its maturity date, usually at a predefined price.
Convertible
Refers to a security (like bonds or preferred shares) that can be converted into a different form, commonly shares of the company's common stock.
Secured
Refers to loans or debt that are backed by collateral, reducing the risk for lenders.
- Attain an understanding of the different forms of bonds, covering term bonds, those that are secured and unsecured, together with callable and convertible bonds.
Verified Answer
FD
Frankie DoyleJun 10, 2024
Final Answer :
A
Explanation :
Bonds can be categorized as either secured or unsecured. Secured bonds are backed by collateral, while unsecured bonds, also known as debentures, are not.
Learning Objectives
- Attain an understanding of the different forms of bonds, covering term bonds, those that are secured and unsecured, together with callable and convertible bonds.