What Are the Basic Differences Between Bonds and Stocks

question 9

Essay

What are the basic differences between bonds and stocks?

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Definitions:

Normative Statements

Statements that express value judgments or opinions about what ought to be, rather than facts that can be tested or verified.

Facts

Pieces of information that are verifiably true and can be proven with evidence or observation.

Rational Individuals

The concept that individuals make decisions based on the maximization of their utility or benefit, taking into consideration all available information and factors.

Preferences

The individual tastes and choices made by consumers in regard to different goods and services.