Final answer:
The statement is false, as not all debt securities are carried at historical cost. Specifically, only held-to-maturity securities are recorded at historical cost, whereas trading and available-for-sale securities are reported at fair value, using various valuation methods if the fair value is not readily determinable.
Step-by-step explanation:
The statement that all investments in debt securities whose fair values are not readily determinable are carried at historical cost is false. Generally, debt securities are categorized into three types for accounting purposes: held-to-maturity, trading, and available-for-sale. Held-to-maturity securities, which the company has the intent and ability to hold to maturity, are recorded at historical cost. However, trading and available-for-sale securities should be reported at fair value, even if this value is not readily determinable. If fair value cannot be determined, other valuation methods, such as discounted cash flows or valuation models, might be used.
The question seems to be part of a larger discussion about government debt and spending, as well as general principles of finance and investments, which can impact the valuation and accounting for various financial instruments. It is also important to note that real-world calculations for the price of a bond are complex and influenced by market interest rates and the credit risk of the borrower. Nonetheless, the price of a bond reflects the present value of expected future payments.