Nate purchased an interest-bearing security last year, planning to hold it until maturity. He received interest payments, and

Question

2 years ago

12

Nate purchased an interest-bearing security last year, planning to hold it until maturity. He received interest payments, and

, to his surprise, a sizable amount of the principal was paid back in the first year. This happened again in year 2. What type of security did Nate purchase?

Business

2 answers:

Reil [10] · Answer 1 · 2022-06-28T20:58:31+03:00

Answer:

The type of security that Nate purchased is an asset backed security

Explanation:

Based on the illustration given in the question, Nate purchased an asset backed security.

An asset-backed security is a financial security such as a bond or note which is collateralized by a pool of assets such as loans, leases, credit card debt, royalties, or receivables.

Reil [10] · Answer 2 · 2022-06-28T19:31:33+03:00

Answer:

asset-backed securtiy

Explanation:

Based on the scenario being described within the question it can be said that in this situation Nate seems to have purchased an asset-backed securtiy. This is a security that derives it's value and pre-defined pool of different assets which generate the income payments or interest payments that Nate seems to be receiving.

Nate purchased an​ interest-bearing security last​ year, planning to hold it until maturity. He received interest​ payments, and

Nate purchased an interest-bearing security last year, planning to hold it until maturity. He received interest payments, and