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What is Debt Bondage and how does it exist in various parts of the world?

Question:

What is Debt Bondage and how does it exist in various parts of the world?

Debt and Debt Instruments

A debt is money owed to the lender by the borrower. Most corporations and government entities raise capital through debt instruments. The debt is later paid plus interest at maturity and as per the agreement between the parties involved.

Answer and Explanation:

Debt Bondage

Debt bondage also referred to as debt slavery occurs when a person is forced to work to pay off an outstanding debt. Most of the money or all the money they earn from their hard work goes towards settling the debt. Debt bondage is prevalent in most developing countries and primarily in South Asia and Sub-Saharan Africa.


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Long-Term Debt: Definition, Cost & Formula

from Financial Accounting: Help and Review

Chapter 8 / Lesson 7
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