Asked by Diana Garcia on Jun 23, 2024
Verified
CorpoNeeds is an e-commerce company that sells office supplies.In an attempt to raise long-term funds,the company decides to issue bonds to lenders.These bonds do not have fixed interest payments,and the rate of interest changes depending on economic conditions.The bonds issued by CorpoNeeds are examples of:
A) floating-rate bonds.
B) junk bonds.
C) secured bonds.
D) serial bonds.
E) debenture bonds.
Floating-Rate Bonds
Debt securities where the interest payments fluctuate with market interest rates rather than being fixed, potentially offering less predictable returns.
E-Commerce
The buying and selling of goods or services using the internet, and the transfer of money and data to execute these transactions.
- Recognize the unique features and risks of different bond types, including floating-rate, junk, and secured bonds.
Verified Answer
KR
Kelsey RosenbergJun 29, 2024
Final Answer :
A
Explanation :
Floating-rate bonds have interest payments that change based on economic conditions, which matches the description of the bonds issued by CorpoNeeds.
Learning Objectives
- Recognize the unique features and risks of different bond types, including floating-rate, junk, and secured bonds.