{"id":219348,"date":"2025-05-26T04:23:05","date_gmt":"2025-05-26T04:23:05","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=219348"},"modified":"2025-05-26T04:23:07","modified_gmt":"2025-05-26T04:23:07","slug":"each-of-the-following-is-correct-regarding-bonds-except-they-are","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/05\/26\/each-of-the-following-is-correct-regarding-bonds-except-they-are\/","title":{"rendered":"Each of the following is correct regarding bonds except they are"},"content":{"rendered":"\n<p>. Each of the following is correct regarding bonds except they are<\/p>\n\n\n\n<p>a. a form of interest-bearing notes payable.<br>b. attractive to many investors.<br>c. issued by corporations and governmental agencies.<br>d. sold in large denominations.<\/p>\n\n\n\n<p><strong><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-ast-global-color-1-color\">The Correct Answer and Explanation is:<\/mark><\/strong><\/p>\n\n\n\n<p><strong>Correct Answer: d. sold in large denominations.<\/strong><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\">Explanation<\/h3>\n\n\n\n<p>Bonds are a common form of long-term debt used by corporations, municipalities, and governments to raise capital. They are essentially interest-bearing notes payable, where the issuer promises to pay the bondholder a fixed interest (coupon) over a specified period and repay the principal at maturity. Let\u2019s examine why each statement is correct or incorrect:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>a. A form of interest-bearing notes payable<\/strong> \u2013 This is <strong>true<\/strong>. Bonds are indeed a form of long-term liability. When an entity issues bonds, it is borrowing money from investors with the obligation to pay periodic interest and repay the face value on maturity.<\/li>\n\n\n\n<li><strong>b. Attractive to many investors<\/strong> \u2013 This is also <strong>true<\/strong>. Bonds are appealing to investors because they typically provide a predictable income stream through interest payments. Moreover, bonds are generally considered less risky than stocks, especially government and investment-grade corporate bonds.<\/li>\n\n\n\n<li><strong>c. Issued by corporations and governmental agencies<\/strong> \u2013 Again, <strong>true<\/strong>. Both public and private entities issue bonds. Corporations issue them to finance expansion, research, or operations. Governments issue bonds to fund public projects or manage budget deficits.<\/li>\n\n\n\n<li><strong>d. Sold in large denominations<\/strong> \u2013 This is <strong>false<\/strong>, making it the correct choice for this question. Bonds are typically sold in <strong>small denominations<\/strong>, often in increments of <strong>$1,000<\/strong>. This lower denomination allows individual investors to purchase bonds without needing large amounts of capital, making bonds more accessible to a broader range of investors.<\/li>\n<\/ul>\n\n\n\n<p>The idea that bonds are sold only in large denominations is a misconception. While some institutional bonds may involve large investments, the vast majority available in the retail market are structured for affordability. Thus, option <strong>d<\/strong> is the exception among the otherwise correct statements about bonds.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"https:\/\/learnexams.com\/blog\/wp-content\/uploads\/2025\/05\/learnexams-banner5-15.jpeg\" alt=\"\" class=\"wp-image-219349\"\/><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>. Each of the following is correct regarding bonds except they are a. a form of interest-bearing notes payable.b. attractive to many investors.c. issued by corporations and governmental agencies.d. sold in large denominations. The Correct Answer and Explanation is: Correct Answer: d. sold in large denominations. Explanation Bonds are a common form of long-term debt [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-219348","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/219348","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=219348"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/219348\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=219348"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=219348"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=219348"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}