Which of the Following Statements Is FALSE

question 81

Multiple Choice

Which of the following statements is FALSE?

• A)Asset-backed bonds and mortgage bonds are secured debt: Specific assets are pledged as collateral that bondholders have a direct claim to in the event of bankruptcy.
• B)The registered bond system also facilitates tax collection because the government can easily keep track of all interest payments made.
• C)Although the word 'bond' is commonly used to mean any kind of debt security; technically, a corporate bond must be secured.
• D)Notes typically have longer maturities (more than 10 years)than debentures.

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Definitions:

Managed-Floating System

A foreign exchange policy whereby a country's central bank intervenes to control its currency value within certain limits, while still allowing the currency value to fluctuate in response to market forces.

Current Account Deficit

A situation where a country's total imports of goods, services, and transfers exceed its total exports, indicating it is spending more on foreign trade than it is earning.

Exchange Rate

The value of one currency for the purpose of conversion to another, determining how much one currency is worth in terms of another.