If the amount of annual principal repayment is scheduled to increase each year by approximately the same amount that interest payments decrease,this type of bond would be what kind of serial bond?

Question

Quizplus · Accepted Answer

This type of serial bond is known as an annuity bond, where the amount of annual principal repayment increases by the same amount that interest payments decrease. This creates a steady stream of payments that is easier for the issuer to manage and for investors to predict.

If the Amount of Annual Principal Repayment Is Scheduled to Increase