Which of the Following Bonds Is Typically Secured

question 45

Multiple Choice

Which of the following bonds is typically secured?

• A) Sinking fund debenture
• B) Mortgage bond
• C) Floating rate note
• D) Eurobond
• E) None of the above

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Definitions:

Capital Cost Allowance (CCA)

Depreciation for tax purposes, not necessarily the same as depreciation under International Financial Reporting Standards; depreciation method under Canadian tax law allowing for the accelerated write-off of property under various classifications.

After-Tax Operating Income

The income a company generates from its operations after subtracting taxes.

Required Return

The minimum expected return by investors for investing in a particular security or project, reflecting the risk level.

Fixed Assets

Long-term tangible assets held for business use and not expected to be converted to cash in the short-term.