Which of the following is true of debt securities?

Question

Quizplus · Accepted Answer

A debt security, such as a bond, specifies a particular maturity date at which the principal amount will be repaid.

Option A is incorrect as the periodic payment on a debt security is called interest, not dividend.

Option C is incorrect as interest is the payment made to the investor for lending money through a debt security.

Option D is incorrect as the payment on a debt security is typically fixed and not dependent on the company's profits.

Which of the Following Is True of Debt Securities