Which of the following sources of capital should not be selected by a business if its fixed cost is high?

Preference shares

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All of the above

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Debentures

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Equity shares

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Solution

The correct option is C
Debentures

Answer (c) Debentures
Explanation: Debentures are a debt instrument utilised by organisations and governments to give credit. Debentures are otherwise called a bond that fills in as an IOU among purchasers and issuers. Organisations use debentures when they need to borrow cash at a fixed rate of interest for their development.

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