A bondissuer is lending money; a bondholder is borrowing money. Select one: True False

To be effective issuing and investing in bonds, knowledge of their terminology, characteristics, and features is essential. For example: • A bond’s    refers to the interest payment or payments paid by a bond. • A bond issuer is said to be in    if it does not pay the interest or the principal in accordance with the terms of the indenture agreement or if it violates one or more of the issue’s restrictive covenants. • The contract that describes the terms of a borrowing arrangement between a firm that sells a bond issue and the investors who purchase the bonds is called    . • A bond’s    gives the issuer the right to call, or redeem, a bond at specific times and under specific conditions.   Suppose you read an article about the Golden Gate Bridge and Highway District bonds. It includes the following information: Bridge Bonds Series A Dated 7-15-2005 4.375% Due 7-15-2055 @100.00   What is the issuing date of this bond? 7-15-2005   7-15-2055…

A synthetic Collateralized Debt Obligation uses credit default swaps to increase the credit risk of its assets. O True O False

Give an example of two types of cash flow that a bondholder will receive from the issuer.