MANAGEMENT

BUISENESS MANAGEMENT

FINANCIAL MANAGEMENT

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
A company selling a bond is ____ money.
A
borrowing
B
lending
C
taking
D
reinvesting
Explanation: 

Detailed explanation-1: -The seller of a bond is a borrower. The bond buyers pay now in exchange for promises of future repayment-that is, they are lenders. The bond sellers receive money now and in exchange for their promises of future repayment-that is, they are borrowers.

Detailed explanation-2: -Issuing bonds is one way for companies to raise money. A bond functions as a loan between an investor and a corporation. The investor agrees to give the corporation a certain amount of money for a specific period of time. In exchange, the investor receives periodic interest payments.

Detailed explanation-3: -Bond financing is a type of long-term borrowing that state and local governments frequently use to raise money, primarily for long-lived infrastructure assets. They obtain this money by selling bonds to investors. In exchange, they promise to repay this money, with interest, according to specified schedules.

Detailed explanation-4: -In the equity market, investors and traders buy and sell shares of stock. Stocks are stakes in a company, purchased to profit from company dividends or the resale of the stock. In the debt market, investors and traders buy and sell bonds.

There is 1 question to complete.