Chapter 14 & 15 Flashcards
(19 cards)
The extent to which a bonds price is less than its face amount, or its principal
Discount (of a bond)
The extent to which a bonds price exceeds the face amount of the debt
Premium (of a bond)
The yield earned on a bond from the time it is acquired until the time it is called and retired by the firm
Yield to call
The average time it takes to collect a bonds interest and principal repayment
Duration
Savings bonds issued in small denominations by the federal government
Series EE bonds
Short-term federal government securities
Treasury bills
The intermediate term debt of the federal government
Treasury notes
The long-term debt of the federal government
Treasury bonds
Securities whose principal and interest payments are adjusted for changes in the consumer price index
Inflation-indexed secuties
Debt issued by an agency of the federal government
Federal agency bonds
Non obligatory support for a debt issue
Moral backing
Mortgage passed through bond issued by the government national mortgage association
Ginnie Mae
Bond secured by mortgages that periodically receives interest and principal repayments
Mortgage-backed bond
Debt obligation supported by mortgages and sold in series
Collateralized obligation (CMO)
Subdivisions of a bond issue
Tranches
A bond issued by a state or one of its political subdivisions whose interest is not taxed by the federal government
Municipal (tax-exempt) bond
A bond whose interest does not depend on the revenue of a specific project; government bonds supported by the full faith and credit of the issuer (authority to tax)
General obligation bond
A bond whose interest is paid only if the debtor earns sufficient revenue
Revenue bond
A short-term liability that is to be retired by specific expected revenues (expected tax receipts)
Anticipation note
