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Explain what condition must occur for each of the following to occur: (1)the capital stock to increase; (2)the capital stock to decrease; and (3)the capital stock to remain constant.
Debt/Equity Ratio
The ratio that highlights the proportional use of debt and shareholders' equity in asset financing for a company.
Stripped Common Shares
Common stock on which dividends and capital gains are repackaged and sold separately.
Dividends
Payments made by a corporation to its shareholders, usually derived from the company's profits, as a reward for investing in the company's equity.
Capital Gains
Capital Gains are the profits realized from the sale of assets such as stocks, bonds, or real estate, which exceed the purchase costs.
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