Which of the Two Bonds in Each Example Would You

question 36

Essay

Which of the two bonds in each example would you expect to generally pay the higher interest rate? Explain why.
a.a German government bond or a South African government bond
b.a 6-month Treasury bill or a 20-year Treasury bond
c.a Microsoft bond or a bond issued by a new recording company

---

Definitions:

Other Revenue

Income generated from activities not related to a company’s primary operations.

Fixed Assets

Long-lasting physical resources used in the functioning of a business, not expected to be spent or transformed into cash over the course of one year.

Current Assets

Resources intended to be turned into cash, disposed of, or utilized within a period of one year or the duration of the company's usual operational cycle, depending on which of the two extends longer.

Impaired Goodwill

A decrease in the value of goodwill on a company's balance sheet, often due to a company's acquired assets not performing as expected.