In economic terms, what is debt?

Debt, in economic terms, refers specifically to the money that one party owes to another and is obligated to repay under agreed-upon terms. This typically involves a borrower and a lender, where the borrower receives a sum of money from the lender with the understanding that it will be repaid over time, often with interest. Understanding debt is crucial because it illustrates the dynamics of borrowing and lending in the economy, as well as the importance of contractual agreements between parties.

The other options do not accurately capture the definition of debt. The total amount of assets owned by a party describes their net worth or wealth, not debt. A signal of financial success might indicate financial health or performance but doesn't define what debt is. Lastly, an investment with a guaranteed return refers to a type of investment rather than a liability. These distinctions highlight why the first choice is the correct description of debt in economic terms.