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      Question

      Consider the following statements about Bonds:

      1.ย  Bonds are units of corporate debt issued by companies and securitized as tradable assets. 2.ย  A bond is referred to as a fixed-income instrument. 3.ย  Bonds traditionally paid a fixed interest rate (coupon) to debtholders. Which of the above statement is/are correct?
      A 1 only Correct Answer Incorrect Answer
      B 2 only Correct Answer Incorrect Answer
      C 3 only Correct Answer Incorrect Answer
      D 1 and 2 both Correct Answer Incorrect Answer
      E 1, 2 and 3 Correct Answer Incorrect Answer

      Solution

      Bonds : Bonds are units of corporate debt issued by companies and securitized as tradable assets. A bond is referred to as a fixed-income instrument since bonds traditionally paid a fixed interest rate (coupon) to debtholders. Variable or floating interest rates are also now quite common.

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