Discuss at Least Three Differences Between Investing in Stocks and Investing

question 34

Essay

Discuss at least three differences between investing in stocks and investing in bonds.

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Definitions:

Cash Dividend

A distribution of profits by a corporation to its shareholders in the form of cash.

Net Income

A company's total profit calculated by subtracting total expenses from total revenues.

Contingently Issuable Common Stock

Shares that may be issued in the future based on the occurrence of certain events.

Diluted Earnings Per Share

A measure of a company's profit divided by the number of shares outstanding, including all possible sources of conversion.