Which of these CMO bond issues has characteristics of both a zero-coupon bond and a regular bond?
A)Class A bonds.
B)Class B bonds.
C)Class C bonds.
D)Class Z bonds.

Question

Quizplus · Accepted Answer

Class Z bonds are typically structured as zero-coupon bonds, meaning that they do not make any periodic interest payments. However, they also have characteristics of regular bonds because they have a maturity date at which the issuer must repay the principal amount of the bond.

Which of These CMO Bond Issues Has Characteristics of Both