Which of the Following Describes a Debenture

question 9

Multiple Choice

Which of the following describes a debenture?

• A) A bond that repays principal in installments
• B) A bond that gives the bondholder a claim for specific assets if the issuer fails to pay
• C) A bond that matures at one specified time
• D) A bond that is not backed by specific assets

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Definitions:

Base Year

A fixed reference point or year used for comparison purposes in financial and economic analysis.

Rate of Return

The increase or decrease in value of an investment over a certain time frame, shown as a percentage of the investment's original price.

Total Assets

The total value of everything a company owns, encompassing cash, stocks, real estate, and machinery.

Common Stockholders

Investors who own shares of common stock in a company, granting them voting rights and a share in the company's profits through dividends.