For a Corporation, Issuing Bonds Is Riskier Than Issuing Stock

question 203

True/False

For a corporation, issuing bonds is riskier than issuing stock.

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Definitions:

Operating Activities

Transactions and events that affect net income, related to the primary operations of the business.

Contingent Activities

Contingent activities are actions or events that may occur but their happening is dependent upon certain conditions or situations being met.

Financing Activities

Financing activities are transactions involving obtaining or repaying capital, including issuing equity, borrowing loans, and paying dividends.

Investing Activities

Financial transactions that relate to the acquisition or sale of assets, investments, and other long-term items that are not part of the company's primary operations.