Question

1. The part of corporate profits that is paid to the shareholders of a corporation is...

1. The part of corporate profits that is paid to the shareholders of a corporation is

a. retained earnings.

b. shareholders.

c. dividends.

d. business revenue.

2. A difference between a share of stock in a corporation and a corporate bond is that

a. the share of stock is a legal claim while the bond is not.

b. the bond owner has voting rights within the corporation whereas the stockholder does not.

c. 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.

d. stocks are issued in return for funds that are lent to the corporation.

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Answer #1

Answer

1. The correct answer is option c.

c. dividends

The part of corporate profits that is paid to the shareholders of a corporation is called dividends. Dividends are part of corporate profits that are given to shareholders of a corporation.

2. The correct answer is option a.

a. the share of stock is a legal claim while the bond is not.

The share of stock is a legal claim on the ownership of a company whereas bonds are a long term debt taken by the company and pay an annual coupon payment to the bondholder.

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