Bonds and Bond Yields Flashcards
(3 cards)
1
Q
What is a bond
A
A piece of paper that guarantees holder regular interest payments and getting value of bond back when it matures
2
Q
Who issues bonds and why
A
- governments who don’t have tax revenues to fund spending
- firms to earn money
3
Q
who buys bonds and why
A
individuals, firms, governments
* return on bonds may be better than other financial assets
*its safer than other assets.
