A debt security pays ____________.
A)a fixed level of income for the life of the owner
B)a variable level of income for owners on a fixed income
C)a fixed or variable income stream at the option of the owner
D)a fixed stream of income or a stream of income that is determined according to a specified formula for the life of the security
E)none of the above

Question

Quizplus · Accepted Answer

A debt security, such as a bond, pays a fixed stream of income or a stream of income that is determined according to a specified formula for the life of the security. This income stream is known as the coupon rate and is set at the time of issuance. Investors who own the security receive regular interest payments until the security matures, at which point the principal is repaid.

A Debt Security Pays ____________