Legal Capacity Simply Refers to the Ability of a Party

question 36

True/False

Legal capacity simply refers to the ability of a party to enter into a contract.

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Definitions:

Reverse Stock Split

A corporate action where a company decreases the number of its outstanding shares to increase the share price without altering the company's market capitalization.

Par Value

The nominal or face value of a bond, share, or other financial instruments, which does not necessarily reflect its market value.

Debt-Equity Ratio

The debt-equity ratio is a financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets, often used to assess financial leverage.

Residual Dividend Policy

A strategy where a company pays dividends out of the residual or leftover equity only after all project capital requirements and operational expenses are met.