A difference between a share of stock in a corporation and a corporate bond is that
A. the bond owner is entitled to receive a fixed annual coupon payment plus a lump-sum payment at the bond's maturity date, whereas the stockholder is entitled to a share of future profits.
B. stocks are issued in return for funds that are lent to the corporation.
C. the share of stock is a legal claim while the bond is not.
D. the bond owner has voting rights within the corporation whereas the stockholder does not.
Answer: A
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Of the four models of the business cycle, which model's implication concerning the change in real wages during recessions is consistent with actual observed changes in real wages during recessions?
A) the Real Business Cycle theory B) the Friedman-Phelps-Lucas Model C) the Keynesian Model D) None of the above.
When it comes to the supply curve of janitors and accountants,
A) the supply curve of janitors is more elastic. B) the supply curve of accountants is more elastic. C) both supply curves are equally elastic. D) More information is needed.
Consider a consumer who spends all income on only two goods: pizza and soda. An extra slice of pizza would give the consumer 60 extra utils, while an extra can of soda would give the consumer 20 extra utils. Pizza costs $3 per slice, and soda costs $1 per can. In this situation, the consumer:
A. is buying too much pizza and not enough soda. B. should purchase more pizza and less soda. C. has maximized his or her total utility. D. needs to equate the marginal utilities for pizza and soda.
Inflation is a rise in:
A. The general level of prices over time B. The standard of living over time C. Unemployment over time D. Real GDP over time