Katie Owns 100 Shares of ABC Stock

question 39

Multiple Choice

Katie owns 100 shares of ABC stock.Which one of the following terms is used to refer to the return that Katie and the other shareholders require on their investment in ABC?

• A)Weighted average cost of capital
• B)Pure play cost
• C)Cost of equity
• D)Subjective cost
• E)Cost of debt

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Definitions:

Security Interest

A legal claim or lien on property or assets, granted to secure the performance of an obligation or repayment of a debt.

Proportionate Shares

The allocation of benefits, responsibilities, or liabilities among parties in relation to their respective interests or contributions.

Priority

The status of having precedence or importance over others, often used in the context of orders of payment, task handling, or legal rights.

Security Interest

A legal claim or right granted by a borrower to a lender over the borrower's assets as collateral for the loan, ensuring repayment security.