What Is One Difference Between Stocks and Bonds

question 31

Multiple Choice

What is one difference between stocks and bonds?

• A)Bonds earn a higher rate of return than stocks.
• B)Stocks earn a higher rate of return than bonds.
• C)Bonds are purchased at a bank,while stocks are purchased through the federal government.
• D)Stocks represent partial ownership in a firm,while bonds do not.

---

Definitions:

Investment Proposals

Detailed plans or suggestions put forward for consideration or discussion, especially regarding potential financial investments.

Operational Units

Divisions or segments within an organization that focus on specific operational tasks or projects.

External Financing Need

External financing need is the amount of funding a business requires from sources outside its operations, such as loans or investor capital, to finance its activities or growth.

Dividend Payout Ratio

A financial measurement that calculates the percentage of earnings distributed to shareholders in the form of dividends.