Chapter 11

8. Direct relationship between the amount of risk you take and the amount of reward you receive
10. A fund to which annual or semiannual deposits are made for the purpose of redeeming a bond issue
12. A financially independent firm that acts as the bondholders’ representative
13. A bond that is backed only by the reputation of the issuing corporation
14. A debt security by a state or a government
15. A corporate bond that pays higher interest but also has a higher risk of default
17. For a corporation bond the date on which corporation is to repay the borrowed money
20. A bond backed by the full faith, credit, and unlimited buying power of the government that issued it.

1. A corporate bond secured by various assets of the issuing firm
2. A bond that can be exchanged, at the owner’s option, for a specificized number of shares of the corporation’s common stock.
3. A feature that allows the corporation to call in, or buy, outstanding bonds from current bondholders before the maturity date
4. The result of changes in the interest rates in the economy.
5. A legal document that details all of the conditions relating to a bond issue
6. Corporations written pledge to repay and specified amount of money with interest
7. Economic growth is not very predictable.
9. A bond that is repaid from the income generated by the project it is designed to finance.
11. Bonds of a single issue that matures on different dates
16. The written pledge of a government or a municipality to repay a specified sum of money, along with interest
18. During periods of high inflation, there is a risk that the financial return on an investment will not keep pace with the inflation rate
19. The dollar amount the bondholder will receive at the bond’s maturity