If You Own a Security in a Company, Such as Common

question 429

Multiple Choice

If you own a security in a company, such as common stock in IBM, you have:

• A) an undivided interest in the company
• B) a security subject to federal regulation
• C) the right to sell the security back to IBM in exchange for other assets
• D) an undivided interest in the company and a security subject to federal regulation
• E) an undivided interest in the company and a security subject to federal regulation and the right to sell the security back to IBM in exchange for other assets

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Definitions:

Legality

The state or quality of being in accordance with the law.

Statutory Law

Law that is written and enacted by a legislative body, distinguishing it from common law or judge-made law.

Valid Contract

An agreement that meets all legal requirements and is enforceable by law.

Contractual Capacity

The legal ability of a person to enter into a contract.