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Finance Terms - Fill in the Blanks

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Fill in the blanks by choosing the appropriate term from the following list:

lease, funded, floating-rate, eurobond, convertible, subordinated, call, sinking fund, prime rate,private placement, public issue, senior, unfunded, eurodollar rate, warrant, debentures, term loan.

a. Debt maturing in more than 1 year is often called ____ debt.
b. An issue of bonds that is sold simultaneously in several countries is traditionally called a(n) ________.
c. If a lender ranks behind the firm's general creditors in the event of default, the loan is said to be _
d. In many cases a firm is obliged to make regular contributions to a(n) _________, which is then used to repurchase bonds.
e. Most bonds give the firm the right to repurchase or _________ the bonds at specified prices.
f. The benchmark interest rate that banks charge to their customers with good to excellent credit is generally termed the _________.
g. The interest rate on bank loans is often tied to short-term interest rates. These loans are usually called _________ loans.
h. Where there is a(n) _______, securities are sold directly to a small group of institutional investors. These securities cannot be resold to individual investors. In the case of a(n)_________, debt can be freely bought and sold by individual investors.
i. A long-term rental agreement is called a(n) ______.
j. A(n) _________ bond can be exchanged for shares of the issuing corporation.
k. A(n) ________ gives its owner the right to buy shares in the issuing company at a predetermined price.

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Solution Summary

The solution answers and explains the fill in the blanks terms. The appropriate terms are chosen from the following list: lease, funded, floating-rate, eurobond, convertible, subordinated, call, sinking fund, prime rate,private placement, public issue, senior, unfunded, eurodollar rate, warrant, debentures, term loan.

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Your answers to b, f, h, and i) were correct.
The definitions have been taken from Yahoo finance glossary.

a. Debt maturing in more than 1 year is often called _ TERM LOAN _ debt.

Term loan is a bank loan , that matures in between one and ten years and requires a specified repayment schedule.

b. An issue of bonds that is sold simultaneously in several countries is traditionally called a(n) _ EUROBOND._____.

Eurobond is a bond which is underwritten by an international syndicate, offered simultaneously to investors in a number of countries, and issued outside the jurisdiction of any single country.

c. If a lender ranks behind the firm's general creditors in the event of default, the loan is said to be SUBORDINATED
_

Subordinated debt is a debt over which senior ...

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