Erica invests $5,000 in five ABC Corporation bonds that mature in 10 years. Unexpectedly just the week after she invests, she has the opportunity to work abroad, which she has always wanted to do, but she needs cash. Which of the following most likely applies to Erica?

Question

Quizplus · Accepted Answer

While Erica may be able to immediately sell her bonds, it is uncertain how much she will receive for them. The value of bonds can fluctuate based on various factors, such as interest rates and market conditions. Therefore, although she may not receive the full value of her investment, she can still sell the bonds and potentially receive some cash. Option A is unlikely as she may not have accrued any interest in just one week. Option B is incorrect as bonds can be sold before maturity. Option D is also incorrect as the primary market is where new securities are issued, not where existing securities are sold.

Erica Invests $5,000 in Five ABC Corporation Bonds That Mature