C. fixed-income loans to a company, entitling holders to a fixed interest

JAMB Economics 2019 Objective — Question 20

Question 20 of 40 from the Joint Admissions and Matriculation Board (JAMB) Economics 2019 Objective paper, with the correct answer and a full explanation.

Debentures refer to

A. ordinary shares
B. preference shares
C. fixed-income loans to a company, entitling holders to a fixed interestCorrect
D. government treasury bills

Explanation

Debentures refer to fixed-income loans to firms; holders of debenture stock are entitled to receive a fixed interest on the sums invested.

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