_________Bonds Reduce a Bondholder's Risk by Requiring the Issuer to Create

question 232

Short Answer

_________bonds reduce a bondholder's risk by requiring the issuer to create a fund of assets set aside as specified amounts and dates to repay the bonds.

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Definitions:

Accounts Receivables

The amounts of money owed to a company by customers for goods or services that have been delivered or used but not yet paid for.

Negotiable Instrument

A document in writing that promises to pay a certain sum of money, either upon request or at a predetermined date, with the person responsible for payment identified on the document.

Delivered

Refers to goods, documents, or other items that have been transported and handed over to the person they were intended for.

Conditional Endorsement

An endorsement whereby payment can be made only on the fulfillment of a predecided condition, such as painting one’s house.