Stockholders normally receive higher expected returns, compared to bondholders, since
A. the government mandates higher payments to stockholders.
B. stock prices go up and down while bond prices do not.
C. profits may only be retained by the corporation and not paid out to stockholders.
D. stockholders could be left with nothing if the corporation fails, and bondholders will receive interest payments even if the corporation suffers losses.
Answer: D
You might also like to view...
Lisa spends all her income on pizzas and DVDs. The above table shows Lisa's marginal utility for pizza and marginal utility for DVDs
If the price of a pizza is $10 and the price of a DVD is $10 and Lisa has $60 to spend on the two goods, what combination of pizza and DVDs will maximize her utility? A) 2 DVDs and 4 pizzas B) 3 DVDs and 5 pizzas C) 4 DVDs and 2 pizzas D) 3 DVDs and 3 pizzas
Pat's Catering finds that when it caters 20 meals a week, its total cost is $6,000. If Pat has total variable cost of $5,000, what is Pat's total fixed cost?
A) $50 B) $250 C) $1,000 D) $6,000
When all the factors of aggregate expenditure are influenced by income, the multiplier becomes a function of the: a. marginal propensity of government purchases
b. marginal propensity to consume out of disposable income. c. marginal propensity of aggregate expenditure. d. marginal propensity to import.
Lee and Cody are playing a game in which Lee has the first move at A in the decision tree shown below. Once Lee has chosen either aggression or cooperation, Cody, who can see what Lee has chosen, must choose either aggression or cooperation at B or C. Both players know the payoffs at the end of each branch.
In the equilibrium of this game, Lee chooses ________, and then Cody chooses ________.
A. aggression; aggression B. cooperation; cooperation C. cooperation; aggression D. aggression; cooperation