Which of the Following Is a True Statement

question 69

Multiple Choice

Which of the following is a true statement?

• A)A corporation generally obtains equity capital from bondholders.
• B)A corporation must issue either preferred stock or common stock but not both.
• C)When a corporation is experiencing financial problems, an investor should purchase common rather than preferred stock.
• D)Corporations are required to pay dividends every year.
• E)There are no guarantees that a stock's value will go up after a stock split.

---

Definitions:

Payoff

The return or profit from an investment or action.

Alternative Option

A different choice or course of action that is available to individuals or organizations.

Zero-Sum Game

In game theory, a scenario where the gain or loss of one player is precisely offset by the losses or gains of the other players.

Positive-Sum Game

is a situation in economics or game theory where all participants can gain or profit in some way, in contrast to a zero-sum game.