Question

A bond's ______ is generally $1,000 and represents the amount borrowed from the bond's first purchaser. A bond issuer is said to be in _____ If it does not pay the interest or the principal in accordance with the terms of the indenture agreement or if it violates one or more of the issue's restrictive covenants. A bond contract feature that requires the issuer to retire a specified portion of the bond issue each year is called a A bond's gives the issuer the right to call, or redeem, a bond at specific times and under specific conditions. If the price of the bond is initially discounted and offers no coupon payments, the bond is called a bond. The contract that describes the terms of a borrowing arrangement between a firm that sells a bond issue and the investors who purchase the bonds is called the _____. Issuers can gradually reduce the outstanding balance of a bond issue by using a sinking fund account into which they deposit a specified amount of money each year.

Answer 1

Maturity value; Default; Sinking fund provision; Call provision.

Step-by-step explanation:

Maturity value is the sum payable to an investor toward the finish of a debt instrument's holding period (maturity date).

Sinking fund provisions means a provision in some bond indentures requiring the backer to set cash aside to reimburse bondholders at maturity.

A call provision is a provision on a bond or other fixed-pay instrument that enables the guarantor to repurchase and resign its bonds.