Question

question 10 / 10
are loans to a company or government for a set amount of time. they earn interest and are considered low - risk investments.
a. mutual funds
b. derivatives
c. bonds
d. stocks

Explanation:

• Mutual funds are pools of money from many investors, not direct loans.
• Derivatives derive value from an underlying asset (like stocks or bonds), not loans themselves.
• Bonds: When an investor buys a bond, they are lending money to a company or government for a fixed period (maturity). The issuer pays periodic interest (coupon payments) and returns the principal at maturity. Government bonds (especially from stable economies) and investment - grade corporate bonds are often considered low - risk.
• Stocks represent ownership in a company, not a loan.

Answer:

C. Bonds