A Company Would Rarely Sell Its Stock for Below Par

question 83

True/False

A company would rarely sell its stock for below par value.

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Definitions:

Defined Contribution Plans

Retirement plans where the amount invested is defined up front, but the future benefit is not guaranteed, depending on investment performance.

Pension Funds

Financial programs that collect and invest contributions from employers and employees to provide retirement benefits to the employees.

Ordinary Income

Income earned through wages, salaries, commissions, and interest, as opposed to capital gains, which are realized through the sale of assets.

Income Component

The part of an investment's return that comes from dividends or interest payments, as opposed to capital gains.