Ch 7 Crossword Renner
note
an unsecured debt, usually with a maturity under 10 years
coupon rate
the annual coupon divided by the face value/price of a bond
face value
The amount the bondholder will be repaid at maturity.
zero coupon bond
a bond that makes no coupon payments and is thus initially priced at a deep discount
current yield
a bond's annual coupon divided by its price
protective covenant
a part of the indenture limiting certain actions that might be taken during the term of the loan, usually to protect the lender's interest
sinking fund
an account managed by the bond trustee for the purpose of repaying bonds
call provision
an agreement giving the corporation the option to repurchase a bond at a specified price prior to maturity
debenture
an unsecured debt, usually with a maturity of 10 years or more
nominal interest
interest rate or rate of return that has not been adjusted for inflation
real rate
interest rates or rates of return that have been adjusted for inflation
bearer form
the form of bond issue in which the bond is issued without record of the owner's name; payment is made to whomever holds the bond
registered form
the form of bond issue in which the registrar of the company records ownership of each bond; payment is made directly to the owner of record
yield to maturity
the rate required in the market on a bond
Fisher effect
the relationship between nominal returns, real returns, and inflation
annual interest rate
the stated interest payment made on a bond
indenture
the written agreement between the corporation and the lender detailing the terms of the debt issue