If You Wish to Have a Direct Voice in the Running

question 45

Multiple Choice

If you wish to have a direct voice in the running of a company, you should purchase

• A) bonds.
• B) notes.
• C) common stock.
• D) preferred stock.

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Definitions:

Capital Structure

The mix of different forms of external funds used by a firm to finance its activities, including debt and equity.

ROE

Return on Equity (ROE) is a financial ratio that measures the profitability of a company relative to shareholder equity.

Times Interest Earned Ratio

A financial ratio that measures a company's ability to meet its debt obligations, calculated as earnings before interest and taxes divided by interest expense.

Financial Statements

Documents detailing a company's financial performance, including balance sheets, income statements, and cash flow statements.