Which of the Following Is Not an Advantage of Issuing

question 17

Multiple Choice

Which of the following is not an advantage of issuing bonds instead of common stock?

• A) Tax savings result.
• B) Income to common shareholders may increase.
• C) Earnings per share on common stock may be lower.
• D) Stockholder control is not affected.

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Definitions:

Democracy

A form of government in which power is vested in the hands of the people, either directly or through elected representatives.

Montgomery Bus Boycott

Sparked by Rosa Parks’s arrest on December 1, 1955, for refusing to surrender her seat to a white passenger, a successful yearlong boycott protesting segregation on city buses; led by the Reverend Martin Luther King Jr.

Desegregating

The act of eliminating racial segregation, or the separation of different racial groups, in institutions or society.