A Share of Stock Represents a Company-Issued IOU Including a Promise

question 55

True/False

A share of stock represents a company-issued IOU including a promise to repay on a certain date.

---

Definitions:

Securities Act

A 1933 United States law that regulates the sale of securities to the public, requiring transparency to help prevent fraud.

Market Capitalization

The total market value of a company's outstanding shares of stock, calculated by multiplying the stock's price by the total number of shares.

Compliance Costs

Expenses incurred by businesses or individuals to meet legal requirements or regulatory standards.

Securities Exchange Act

A U.S. law governing the trading of securities, such as stocks and bonds, to provide protection for investors.