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pay back a loan with interest. Answer the questions that follow with regard to the bond market. b . Investments can require large amounts of
pay back a loan with interest. Answer the questions that follow with regard to the bond market.
b Investments can require large amounts of capital up
front. It can be hard for large corporations to acquire the
necessary funds for large investments from just one
entity like a bank The bond market thereby provides a
way to
fund government debt.
channel funds from savers to borrowers.
create liquidity.
reduce corporate debt.
d When a company issues bonds in the bond market, the
company finances its project not through one entity, such
as a bank, but many savers. The bond market thus helps
to
fund government debt.
spread risk.
create liquidity.
channel funds from borrowers to savers.
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