Which of the Following Considerations Is Most Important for a Stockholder

question 135

Multiple Choice

Which of the following considerations is most important for a stockholder when evaluating whether to purchase stock in a company?

• A)Will earnings per share be distributed to stockholders?
• B)Will the company earn a fair return on the amount invested by the stockholders?
• C)Will the key ratios be reported on the balance sheet?
• D)Will cash flows from operations exceed the amount of net income for the period?

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Definitions:

Revolutionary War

A conflict from 1775 to 1783 in which the thirteen American colonies won independence from Great Britain.

Bicameral Legislature

A legislative body composed of two chambers or houses; in the United States, it comprises the Senate and the House of Representatives.

Great Compromise

The agreement during the Constitutional Convention of 1787 that created a two-house Congress, with the Senate having equal representation for each state and the House of Representatives based on population.

Articles of Confederation

The first written constitution of the United States, which was in effect from 1781 until it was replaced by the U.S. Constitution in 1789.