From the issuer's perspective, serial bonds compared to term bonds have which distinguishing features?

Serial bonds have a unique structure compared to term bonds, particularly regarding how payments of interest and principal are scheduled. In a serial bond issue, the bonds mature at different intervals rather than all at once, allowing for a gradual repayment of both the principal and interest over time.

The correct choice reflects that serial bonds have declining interest payments. This occurs because each bond in the series is paid off at different maturity dates. As these bonds mature, the outstanding principal amount decreases, leading to lower interest payments over time since interest is calculated on the remaining principal.

Additionally, serial bonds will also feature declining principal amounts that align with the scheduled maturities. Each serial bond's principal is repaid as each tranche matures, resulting in a decrease in the total outstanding balance. This characteristic sets serial bonds apart from term bonds, where the entire principal amount is paid off at once at maturity, and typically, interest payments remain constant throughout the life of the bond.

The other options do not accurately describe the principal and interest payment structure unique to serial bonds. They either imply static or increasing amounts in ways that do not align with how interest and principal are structured within serial bonds.