A Stock Is

question 119

Multiple Choice

A stock is:

• A) a financial asset that represents partial ownership of a company.
• B) a payment made periodically to all shareholders of a company.
• C) an agreement in which a lender gives money to a borrower in exchange for a promise to repay the amount loaned plus an agreed-upon amount of interest.
• D) a promise by a bond issuer to repay a loan at a specified maturity date and to pay periodic interest at a specific percentage rate.

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Definitions:

Commercial Paper

An unsecured, short-term debt instrument issued by corporations, typically used for the financing of payroll, accounts payable and inventories, and meeting other short-term liabilities.

Trade Credit

A type of commercial financing where a customer is allowed to purchase goods or services and pay the supplier at a later scheduled date.

Operating Plan

A detailed document outlining the day-to-day operations required to run a business, including production, staffing, and inventory management processes.

Financial Planning

The process of estimating the capital required and determining its competition; it is the process of framing financial policies in relation to procurement, investment, and administration of funds of an enterprise.