Which of the Following Is an Example of Equity Finance

question 46

Multiple Choice

Which of the following is an example of equity finance?

• A) Corporate bonds
• B) Bank loan
• C) All of these answers are equity finance.
• D) Government bonds
• E) Company shares

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Definitions:

Preferred Stock

A class of ownership in a corporation with a higher claim on assets and earnings than common stock, often with fixed dividends.

Common Stock

A form of equity stake that signifies ownership within a corporation, granting the owner the right to vote and a portion of the corporation's earnings via dividends.

Cash Dividends

Distributions of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders in the form of cash.

Stock Dividend

A type of dividend payment made in the form of additional shares of stock rather than cash, often used by companies to conserve cash.