Income Bonds Are Unusual

question 114

Essay

Income bonds are unusual.Interest payments on these types of bonds may be skipped or deferred if the firm's income is insufficient to make the payments.In what way are these bonds like preferred stock? Why might a firm choose to issue an income bond instead of a preferred stock?

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Definitions:

Componential Intelligence

An aspect of intelligence theory that involves the analytical aspect of intelligence; the ability to analyze and evaluate ideas, solve problems, and make decisions.

Spatial Intelligence

The ability to think in three-dimensional terms, enabling individuals to solve problems involving physical spaces, shapes, or forms.

Intrapersonal Intelligence

The capacity to understand oneself, to appreciate one's feelings, fears, and motivations.

Naturalistic Intelligence

An intelligence type proposed by Howard Gardner that involves the ability to recognize, categorize, and draw upon certain features of the environment.