Which of the Following Would Be a Good Reason to Choose

question 35

Multiple Choice

Which of the following would be a good reason to choose to make an equity investment in a corporation rather than lending money to a corporation?

• A) The return on equity is riskier than debt but is not fixed and may be higher.
• B) The holder of an equity investment always receives a higher return than a debt holder.
• C) The holder of equity has the same legal entitlement to receive dividends as a debt holder has to receive interest.
• D) The return paid on an equity investment is more secure than the return on debt.
• E) It is easier to assess the price of an equity investment.

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Definitions:

Resolve to Win

The determination and commitment to achieve success or victory in a particular endeavor.

Network

A group or system of interconnected people or things, often used for sharing information and resources.

Collaborate

The act of working together with one or more people in order to achieve a common goal or complete a task.

Supportive

Providing encouragement, emotional help, or material assistance to others.