Question

One funding source under consideration is the issuance of $150 million worth of corporate bonds. A financial advisor predicted that in order for the fast growing company to attract investors, it would have to put up collateral to back up the bond issue. The type of bond the financial advisor suggests is_______.

Answer 1

Secured bond.

Step-by-step explanation:

A secured bond is bond that is secured by the issuer's pledge of a specific asset, which is a form of collateral on the loan. In the event of failing to meet an obligation, the bond issuer passes the title of the asset onto the bondholders.