Questions: Multiple Choice
5 points
The written agreement that contains the specific details related to a bond issue is called the bond:
registration statement.
indenture.
document.
debenture.
issue paper.
Next
Transcript text: Multiple Choice
5 points
The written agreement that contains the specific details related to a bond issue is called the bond:
registration statement.
indenture.
document.
debenture.
issue paper.
Next
Solution
Answer
The answer is indenture.
Explanation
Option 1: Registration statement
A registration statement is a set of documents, including a prospectus, that a company must file with the Securities and Exchange Commission (SEC) before it can proceed with a public offering of securities. It is not specifically related to the details of a bond issue.
Option 2: Indenture
An indenture is a formal legal agreement, contract, or document between two or more parties. In the context of bonds, it is the written agreement that specifies the terms and conditions of the bond issue, including the rights and obligations of the issuer and the bondholders.
Option 3: Document
While a bond indenture is indeed a document, the term "document" is too generic and does not specifically refer to the detailed agreement related to a bond issue.
Option 4: Debenture
A debenture is a type of debt instrument that is not secured by physical assets or collateral. It is a way for a company to raise capital, but it does not refer to the written agreement containing the specific details of a bond issue.
Option 5: Issue paper
"Issue paper" is not a standard term used in the context of bond agreements. It does not refer to the detailed written agreement related to a bond issue.