Many bonds have some orderly, preplanned, alternative system of repayment. Which of the following apply?

Question

Quizplus · Accepted Answer

Sinking funds and serial bonds both have preplanned alternative systems of repayment. Sinking funds involve setting aside money each year to gradually pay off the bond, while serial bonds are issued in a series with specific maturity dates, allowing the issuer to repay some of the bonds each year until they are all fully retired. Income bonds, on the other hand, do not have a preplanned alternative system of repayment, as they only pay out interest if the issuer has sufficient funds available.

Many Bonds Have Some Orderly, Preplanned, Alternative System of Repayment