Final answer:
The largest bond a bondsman can write would correspond to the financial capability of the issuing company and the investment structure they choose. For companies, bonds are issued in smaller increments that collectively fulfill the intended borrowing amount. If a company defaults on payments, bondholders have rights to seek dues but may not get the entire amount loaned to the firm.
Step-by-step explanation:
The question seeks to understand the limitations of bond issuance, particularly regarding the largest bond that a professional bondsman or his runner can write. When considering bonds issued by a company, they represent a form of borrowing where the issuer promises to make periodic interest payments followed by the repayment of the principal amount at the end of the bond's term. Companies primarily divide the total amount they wish to raise into multiple smaller-sized bonds to attract various investors, thus maintaining flexibility in financing.
For instance, a firm aiming to raise a substantial amount like $50 million may issue bonds in denominations of $5,000 each, culminating in 10,000 bonds. This segmentation permits investors to effectively loan money to the firm in increments that suit their investment capacity. Bondholders are entitled to receive interest payments, and should the issuer default, they have legal recourse to pursue payment. However, they may not always receive the full amount owed to them due to potential insufficiency in the issuer's assets.