A Type of Long-Term Financing Used by Both Corporations and Government

question 101

Multiple Choice

A type of long-term financing used by both corporations and government entities is

• A) common stock.
• B) bonds.
• C) preferred stock.
• D) retained earnings.

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Definitions:

Money

A medium of exchange that enables people and businesses to buy goods and services; recognized by a society to have value for transactions.

Annuity Due

A series of equal payments made at the beginning of consecutive periods over a fixed length of time.

Payments

Payments refer to the transfer of money from one party to another in exchange for goods, services, or to fulfill a legal obligation.

Perpetuity

A type of annuity that pays an infinite series of equal payments, with no end.