Financial Assets Like Stocks and Bonds Have Value Because

question 52

Multiple Choice

Financial assets like stocks and bonds have value because:

• A)they represent ownership of companies.
• B)people are proud to own them.
• C)they provide tangible benefits as do real assets.
• D)they give their owners command over future cash flows.

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Definitions:

Securities Act of 1933

A U.S. law enacted as part of the New Deal, aimed at ensuring transparency in financial statements so investors can make informed decisions about investments, and establishing laws against misrepresentation and fraudulent activities in the securities markets.

Registration Statement

A document filed with the SEC that contains detailed information about a company's operations and securities it intends to offer.

Malpractice

A failure of a professional to meet the standard of care or conduct in their field, often leading to harm or loss.

Negligence

A lack of acting with the diligence an average reasonable person would show under the same conditions.