SS (for Hannah) Flashcards
(21 cards)
What is a bond?
A loan
Who issues a bond?
Government
What is the purpose of a bond?
To raise money
When the country raises money from a bond they are…
raising capital
Who buys the bond
Customers, citizens of america
What does a bond look like?
A paper certificate
What does the government do with the bond
They get the money and promise to pay the customer back w intrest
Bonds come in set…
denominators
What are examples of denominators?
$25, $50, $100, $500, $1000, $5000
What is “Quid Pro Quo?”
“This for that” (agreement)
What is the cost of a bond?
Half face value
If a bond costs $50, how much will it cost after interest?
$100
What is the cost of a $100 bond?
$50
When does the bond equal full face value?
Depends on interest
When do people often buy bonds?
-Gift for new baby
-during war (to give money to the gov to show patriotism)
What is the soonest you can cash in a bond?
6 months
What is the longest you can wait to cash in?
Up to 30 years
Why is a bond desirable?
Earn interest so owner can make money
Are they safe?
YES they are backed by the Gov
What are the downfalls of bonds?
-Not a quick investment
What does it mean if the bond is mature?
Equals the full face value
