Income Beginner: Buying Bonds

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1.
The time at which you are paid back for a bond is known as its _______.
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Maturity. A bond's maturity is the date upon which the investor's money is repaid by the issuer.
2.
The face value of a bond is known as its _______.
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Par. In bond language, par means face value.
3.
Buying diversified bond mutual funds has more risk than buying a few bonds individually.
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False. Because diversified bond funds contain many different kinds of bonds, they tend to have less risk than small groups of individual bonds.
4.
The more bonds you buy in one sale, the less you will pay in markup costs.
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True. Markups are generally lower for large sales than for small ones.
5.
New-issue bonds are bonds that are sold through the secondary market.
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False. New-issue bonds are purchased directly from the bond issuer with the aid of a broker, who earns a commission for this service.