Holders of Common Shares Receive Certain Benefits,such as a Residual

question 119

Multiple Choice

Holders of common shares receive certain benefits,such as a residual claim,which:

• A)is the right of shareholders to be paid back their investment before anyone else if the company ceases operation.
• B)is the right to oversee management of the company.
• C)is the right to share in any remaining assets after creditors have been paid off if the company is liquidated.
• D)is the continuing right to receive a share of profits as dividends.

---

Definitions:

Excise Tax

A targeted tax imposed on the sale of specific goods and services, such as alcohol, tobacco, and fuel.

Equilibrium Price

The price at which the quantity of a good or service demanded equals the quantity supplied, leading to market stability.

Progressivity

A characteristic of a tax system in which the tax rate increases as the taxable amount increases, placing a larger burden on high-income earners.

Federal Payroll Tax

Taxes imposed by the federal government on the wages of employees, which fund social security and Medicare programs.