A bond provision that specifies payments the issuer must make to redeem a given percentage of the outstanding issue prior to maturity is known as

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A sinking fund provision requires payments to be made by the issuer to redeem a specified portion of the outstanding bonds prior to maturity. This provision helps reduce the issuer's default risk and provides investors with greater security. The other choices are also bond provisions, but they do not specifically require payments for redemption of a portion of the outstanding bond issue.

A Bond Provision That Specifies Payments the Issuer Must Make