The Return on the Money Risked on a Share of Stock

question 175

Multiple Choice

The return on the money risked on a share of stock is called

• A) interest.
• B) dividends.
• C) retained earnings.
• D) capital gains.

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Definitions:

Discount

A reduction from the usual cost of something, often applied to encourage sales or offered to certain groups.

Bonds Payable

Long-term liabilities represented by negotiable certificates, indicating a promise to pay a specified sum of money plus interest at defined intervals.

Straight-line

A method of calculating depreciation of an asset where the expense is evenly distributed over its useful life.

Effective-interest

A method of calculating the interest rate on a loan or financial product that takes into account compound interest and fees, providing a true annual rate.