Basic Instruments For Business Financing - SS1 Economics Past Questions & Answers - page 1

1

What is a share?

A

A type of debt instrument

B

A type of equity instrument

C

A type of government bond 

 

D

A type of crowdfunding platform

CORRECT OPTION: b
2

What is a debenture?

A

A type of equity instrument

B

A type of government bond

 

C

A type of debt instrument

D

A type of crowdfunding platform

CORRECT OPTION: c
3

What is a bond?

A

A type of equity instrument

B

A type of government bond

 

C

A type of debt instrument

D

A type of crowdfunding platform

CORRECT OPTION: c
4

What is the main difference between shares and debentures?

A

Shares represent ownership in a company, while debentures are a type of debt instrument.

 

B

Shares are a type of debt instrument, while debentures represent ownership in a company.

C

Shares and debentures are the same things.

 

D

Neither shares nor debentures are used for business financing.

CORRECT OPTION: a
5

What is the main difference between debentures and bonds?

A

Debentures have a longer maturity period than bonds.

B

Bonds are issued in smaller denominations than debentures.

C

Debentures represent ownership in a company, while bonds are a type of debt instrument.

D

Bonds are typically issued by governments, while debentures are issued by companies.

 

CORRECT OPTION: c
6

What do shareholders receive in return for investing in a company?

Shareholders receive a portion of the company's profits in the form of dividends and have the right to vote on important company decisions.

 

7

How are bonds different from debentures?

 

Bonds are typically issued in larger denominations and have a longer maturity period than debentures.

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