Which of the Following Bond Types Has the Greatest Risk

question 14

Multiple Choice

Which of the following bond types has the greatest risk for investors?

• A) debentures
• B) mortgage bonds
• C) floating rate bonds
• D) subordinated debentures

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Definitions:

Daily Interest

Interest calculated on a daily basis, typically used in various financial products and accounts.

Exponential Notation

A way of writing numbers that accommodates values too large or small for ordinary notation, using a base number raised to a power.

Arithmetic Operations

Fundamental arithmetic processes including adding, subtracting, multiplying, and dividing.

Compound Interest

Interest calculation on a loan or deposit where the interest earned also earns interest, leading to exponential growth over time.