Asked by Matthew Vulku on May 09, 2024

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Debt investments earn interest income over time and the borrower has an obligation to return the original amount of the investment on a fixed maturity date.

Debt Investments

Investments made by purchasing bonds or other debt instruments, typically generating income from interest payments.

Interest Income

Income earned by an individual or entity from various types of investments that pay interest, such as savings accounts, bonds, or loans provided to others.

  • Recognize the characteristics and income generation of debt investments.
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CB
Citlaly BolanosMay 14, 2024
Final Answer :
True
Explanation :
Debt investments involve lending money to an entity (such as a corporation or government) that borrows the funds for a defined period of time at a fixed interest rate. The borrower agrees to pay back the original investment amount (the principal) on a predetermined maturity date, along with interest payments over the life of the investment.