Which of the following are correct regarding bonds? They obligate the issuing company to pay an estimated amount. They obligate the issuing company to repay the bonds when market interest rates decrease. They obligate the issuing company to repay the bonds when interest rates increase. They obligate the issuing company to pay a specific amount. They obligate the issuing company to repay the bonds at a specific date.

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Answer:

The correct statement is They obligate the issuing company to repay the bonds at a specific date.

Explanation:

Bonds are issued by governments and corporations when they want to raise money. By buying a bond, you're giving the issuer a loan, and they agree to pay you back the face value of the loan on a specific date.

A bond is referred to as a fixed income instrument since bonds traditionally paid a fixed interest rate. They are high-risk investments for the issuing company, while they're low-risk for investors.

After repayment of bond on a specific date, the periodic interest that accrue will be paid to the investors subsequently.

Bond is best described as an obligation by the issuing company to repay the bonds at a specific date.

Bonds refers to the promise by a borrower to pay the lender his/her principal and the interest on the loan given.

Bonds is an instrument used by company as an alternatives to taking a loan from banks.

After the repayment of the bond on the specific date, the periodic interest that accrued will be paid to the investors subsequently.

Therefore, option D is correct because its best describes bond.

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