Finance discussion question

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Chapter 7

1Bond Indenture What is a bond indenture? What is the function of a trustee with respect to the bond indenture?

Chapter 8 How Interest Rates Affect Bond Prices Explain the impact of a decline in interest rates on:

Question 9.

Why does the required rate of return for a particular bond change over time?

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Explanation & Answer

Attached.

Running head: BONDS

1

Bonds
Institution Affiliation
Date

BONDS

2

Chapter 7:

What is a bond indenture? What is the function of a trustee with respect to the bond

indenture?

The bond indenture also known as the trust indenture or the deed trust refers to a legal
contract binding the bond issuer and the trustee specifying the amplitude and the roles of a
borrower and the features of a bond. This feature includes the bond maturity date, the coupon rate,
timing of the interest payments, among others. The bond indenture ...


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