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    Question

    The instrument that evidences an acknowledgment of debt

    by a company is called a:
    A Share Certificate Correct Answer Incorrect Answer
    B Warrant Correct Answer Incorrect Answer
    C Debenture Correct Answer Incorrect Answer
    D Fixed Deposit Receipt Correct Answer Incorrect Answer
    E Bond Correct Answer Incorrect Answer

    Solution

    A Debenture is a document that either creates a debt or acknowledges it. In corporate finance, it is a medium- to long-term debt instrument used by companies to borrow money at a fixed rate of interest. While a Bond (E) is similar, in the Indian context, "debenture" is the term commonly used for corporate debt, whereas bonds are often associated with governments and financial institutions.

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