An issue of serial bonds:
A)will pay no interest payments.
B)will have varying issue dates.
C)will have a series of maturity dates.
D)cannot be called.
E)will all mature ten years from the date of issue.

Question

Quizplus · Accepted Answer

Serial bonds have a series of maturity dates, meaning that different portions or "series" of the bonds will have different dates on which they mature. This allows the issuer to spread out their debt payments over time, rather than having to make one large payment at the end of the bond term. The other answer choices are incorrect: A is incorrect because most bonds pay interest payments, B is incorrect because all bonds in a single issue have the same issue date, D is incorrect because many bonds can be called prior to maturity, and E is incorrect because serial bonds have different maturity dates, not all the same.

An Issue of Serial Bonds