Eurobond is a bond issued outside the country in whose currency it is denominated.

• A. A bond issued outside the country in whose currency it is denominated
• B. A bond issued domestically in the issuer's currency
• C. A bond issued in a foreign country but denominated in the issuer's currency
• D. A bond issued in the United States denominated in US dollars

Answer: (A)

The main concept here is that a Eurobond is issued in a market outside the issuer’s home country and is denominated in a currency different from that country’s currency. In other words, the issue takes place abroad, but the payoff is in a currency that isn’t the issuer’s domestic currency. That combination—being issued outside the country and using a foreign-denominated currency—is what defines a Eurobond.

So the best choice describes a bond that is issued outside the country corresponding to the denomination currency. For example, a company from one country issuing a bond in another country and paying interest in a currency not native to that second country fits this definition. This is what makes it a Eurobond rather than a domestic bond (issued and denominated in the issuer’s own country) or a bond issued in a foreign country but in the issuer’s own currency (which would not be the eurobond pattern). A United States–denominated bond issued in the United States is clearly a domestic issue.