A Deed Is a Special Form of Written Contract Used

question 16

Multiple Choice

A deed is a special form of written contract used to convey a permanent interest in real property. Unlike most contracts, a deed requires:

• A) both parties to be legally competent and of legal majority age.
• B) only the grantee to be legally competent and of legal majority age.
• C) only the grantor to be legally competent and of legal majority age.
• D) both parties to make promises to perform.

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Definitions:

Interest Rates

This represents the cost, in percentage terms of the principal, that a borrower incurs from a lender to utilize their assets.

Maturity Risk

The risk of loss to an investor from changes in the price of a bond that arise from changes in the market interest rate. Also called price risk and interest rate risk. The term maturity risk emphasizes the fact that interest-induced price changes are larger with longer maturities.

Bond Prices

The market price for which a bond is bought or sold, influenced by interest rates, credit quality, and other factors.

Interest Rate Movements

Fluctuations in the interest rate over time which can affect borrowing costs and investment returns.