The financial investor about bonds
Describe three ways to finance corporate activity. Make a case that stocks are more risky for the financial investor than are bonds?
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There are three ways to finance corporate activity: it can be done internally out of undistributed profits or Corporations can borrow from financial institutions or issue their own stocks or bonds.
Common stock is an ownership share in a corporation that gives a holder voting rights and a share of dividends. Bonds are promissory notes where the corporation promises to pay the holder a fixed amount in the future plus annual interest on the loan. A bondholder is not an owner, only a lender. Stocks are usually riskier than bonds. Bondholders have a “legally prior claim” against corporate earnings. Stock dividends cannot be paid until all interest payments due to bondholders are paid. Interest is guaranteed as long as the company is healthy, whereas dividend depends on profits.
The first comprehensive work upon economics written within English was authored through Adam Smith in 1776 year and entitled that “An Inquiry within the Nature and Causes of: (1) Laws of Supply and Demand.” (2) Wealth of Nations.” (3
Describe four important areas to emphasize Expenditures?
Least consistent along with Adam Smith’s theory of wages would be the suggestion that wages vary positively along with the: (w) effort required to learn skills necessary to accomplish particular types of work. (x) stability of employment and the
Explain the statement: “Good economic policy requires good economic theory.”?
What do you understand by the term internal rate of return?
Why entertainment tax comes in indirect tax? Answer: Since its burden can be shifted to others.
Who are the major players in international trade today? Besides Japan, what other Asian nations play significant roles in international trade?
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Illustrate Scarcity and choice of Economic Perspective?
After the Spanish found the new world, they promptly began to plunder this. They imported huge amount of gold and silver to Spain. It inflow of bullion caused a rapid increase in inflation, that would have grave consequences for Spain. It is quick inflation made this
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