Question : What is true regarding debentures issued as collateral security?
Option 1: A debenture issue that is made by a company and given to a lender as secondary security is referred to as debenture issued as collateral security.
Option 2: A debenture issue that is made by a company and given to a lender as primary security is referred to as debenture issued as collateral security.
Option 3: A debenture issue that is made by a company and given to a lender as main security is referred to as debenture issued as collateral security.
Option 4: Both 2 and 3
Correct Answer: A debenture issue that is made by a company and given to a lender as secondary security is referred to as debenture issued as collateral security.
Solution :
A debenture issue that is made by a company and given to a lender as secondary security is referred to as debenture issued as collateral security.
Hence, the correct option is 1.