One type of investment that has a variable income is
One type of investment that has a variable income is
- A) Debentures
- B) Preferred shares
- C) Government bonds
- D) Ordinary shares
Correct Answer: C) Government bonds
Explanation
This question is asking about a type of investment that has a variable income. The options given are Debentures, Preferred shares, Government bonds, and Ordinary shares.Out of these options, the correct answer is Option C: Government bonds.
Government bonds are a type of investment where an individual lends money to the government in return for periodic interest payments. The income from government bonds can vary depending on various factors such as changes in interest rates and the overall performance of the economy. Therefore, the income from government bonds is not fixed or constant, but rather variable.
Debentures, on the other hand, are a type of long-term borrowing by a company where investors lend money to the company and receive fixed interest payments. So, the income from debentures is fixed and not variable.
Preferred shares are a type of ownership in a company that gives shareholders a fixed dividend payment. The income from preferred shares is also fixed and not variable.
Ordinary shares, also known as common shares, represent ownership in a company and provide the shareholders with a share of the company's profits through dividends. The income from ordinary shares can vary depending on the company's performance, but it is not specifically mentioned as a type of investment with variable income in this question.
Therefore, the correct option is C: Government bonds, as they are a type of investment that has a variable income.