Was playing Red Dead 2 and the gang comes into some Bonds. Apparently they’re worth money but idk how the gang gets a profit from it, or how bonds work in civilian life.
In: Economics
A bond works like a loan.
Some entity (like a government), needs money now to fund some project. So, it sells bonds to raise that money. The bond is a promise saying that the bond owner will be paid that money within a certain time frame.
People want to buy the bonds because they include interest in addition to original price sold for. When the bond seller is a very reputable entity like the U.S. government, buying bonds is a guaranteed, low risk way to store and make money as long as you are willing to wait until the bond’s payout date.
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