Firms often bundle up a group of assets and then sell the cash flows from these assets in the form of securities. They are called:
A) Debentures
B) Subordinated issues
C) Asset-backed securities
D) All of the above

Question

Quizplus · Accepted Answer

Debentures and subordinated issues are types of traditional debt securities that are not necessarily tied to a specific group of assets. Asset-backed securities, on the other hand, are specifically tied to the cash flows from a group of assets, such as mortgages or car loans, and are often sold as a bundle.

Firms Often Bundle Up a Group of Assets and Then