Quiz on ” Bonds – An Introduction “

1. What is a bond?

a) A financial instrument that enables an investor to buy stocks

b) An IOU where the borrower borrows money from a lender

c) A type of loan that a borrower gets directly from a bank

2. What is the difference between a bond and a stock?

a) Bonds are equity, while stocks are debt

b) Stocks are transferable and standardized, while bonds are not

c) Bonds are debt, while stocks are equity

3. What is the yield to maturity of a bond?

a) The total amount of interest paid by the borrower to the investor

b) The percentage return an investor gets on their bond investment if held to maturity

c) The rate of interest that's paid on the bond by the borrower

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