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Chapter 10: Bonds and Mutual Funds (Business and Personal Finance)
Terms in this set (30)
the date when a bond will be repaid
the dollar amount that the bondholder will receive at the bond's maturity
a bond that is backed only by reputation of the issuing corporation, rather by its assets
a bond that is backed by assets of a corporation.
a bond that an investor can trade for shares of the corporation's common stock.
a fund to which a corporation makes deposits for the purpose of paying back a bond issue.
bonds issued at the same time but which mature on different dates
a bond registered in the owner's name by the company that issues the bond
a bond that is registered in the owner's name for only the face value and not for interest
a bond that is not registered in the investor's name
a bond that does not produce interest payments
a security issued by a state or local government (town, city, or county) to pay for its ongoing activities.
bonds that are issued by financially stable companies or municipalities
the rate of return, usually stated as a percentage, earned by an investor who holds a bond for a certain period of time
a mutual fund with a fixed number of shares that are issued by an investment company when the fund is first organized
a mutual fund with an unlimited number of shares that are issued and redeemed by an investment company at the investors' request
net asset value (NAV)
the amount that one share of a mutual fund is worth
(sometimes referred to as an "A" fund) a mutual fund for which you pay a commission every time you buy or sell shares
a mutual fund that has no commission fee
earnings a fund pays to shareholders
The face value of a bond is the amount a bondholder
receives at maturity
Assets of a corporation may be sold to repay
a mortgage bond
An additional amount that a company pays above the value of its bond is called
Only the bond owner can collect interest from an
Which investment offers the highest rate of interest?
Municipal bonds are offered by all the following levels of government except
The lowest Standard & Poor's rating a bond can have and still be considered investment grade is
How do you find the current yield of a bond?
divide the amount of annual interest income by the bond's current market value
A back-end load on a mutual fund is charged for
withdrawing money from the fund
Investors pay penalty fees if they fail to make regular purchases of shares when investing in a mutual fund under a
contractual savings plan
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