Which of the Following Is a Difference Between Stocks and Bonds

question 24

Multiple Choice

Which of the following is a difference between stocks and bonds?

• A) Bonds represent ownership; stocks represent debt.
• B) Bonds make interest payments; stocks pay dividends.
• C) Stock payouts are predictable; bond payouts are not.
• D) All of these are differences between stocks and bonds.

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Definitions:

Price Level

The average of current prices across the entire spectrum of goods and services produced in the economy, reflecting inflation or deflation.

Short-Run Aggregate Supply

A curve that shows the relationship in the short term between the price level and the quantity of output provided by firms when some input prices, especially wages, are fixed.

Sticky-Wage Theory

A hypothesis that wages are slow to adjust to the economic conditions, leading to potential unemployment or labor market imbalances.

Natural Rate

An economic theory concept referring to the level of any economic variable that is expected to prevail in the long term under natural conditions, without external influences.