When a Borrower Pledges Financial Assets as Collateral for a Bond

question 57

Multiple Choice

When a borrower pledges financial assets as collateral for a bond it is called a(n)

• A) Mortgage bond.
• B) Equipment trust certificate.
• C) Mortgage pass-through security.
• D) Collateral trust bond.
• E) Collateralized mortgage obligation (CMO).

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Definitions:

Government Spending Programs

Public expenditure initiatives funded by the government aimed at achieving specific social, economic, or infrastructural goals.

General Taxpayers

Refers to individuals and entities that are subject to tax by government policies, encompassing a wide range of income levels and types.

Bundling Projects

The practice of combining several products or projects into a single package deal, often used to sell products or services that may be less desirable individually.

Local Districts

Geographic or administrative divisions within a larger region or country, often used for local governance or electoral purposes.