Which of the following statements is true about bonds?

Question

Quizplus · Accepted Answer

When a bond is issued, the seller (issuer) is borrowing money from the buyer (investor). Therefore, option A is correct. Option B is incorrect because the government and large corporations do not buy bonds to borrow money, but rather issue bonds to raise funds from investors. Option C is incorrect because bond owners can sell their bonds before they mature. Option D is incorrect because the interest rate on a bond is inversely related to its price - when interest rates go up, bond prices go down, and vice versa.

Which of the Following Statements Is True About Bonds