If you wish to have a direct voice in the running of a company, you should purchase

Question

BlackTom AI · Accepted Answer

Consider the scenario: you want a direct voice in how the company is run. 
Option A: bonds. Bonds are debt instruments that represent a loan to the company; bondholders receive interest and the principal back at maturity, but they typically do not have voting rights or a say in corporate governance. Therefore, buying bonds does not grant you influence over management decisions. 
Option B: common stock. Common stock represents ownership in a company. Holders typically have voting rights at shareholder meetings, allowing them to influence corporate policy, elect directors, and participate in major governance decisions. This aligns with the desire for direct voice in the running of the company. 
To assess the statement about purchasing to gain influence, recognize that ownership stakes are the primary way investors obtain governance voice. 
Additional context: while preferred stock can have other preferences (like dividends) it usually does not provide voting rights, or provides limited rights, depending on the issue. Hence it does not offer the same broad governance influence as common stock. 
In summary, debt instruments (bonds) provide creditor rights and fixed payments but not governance rights, whereas equity instruments (common stock) provide ownership and voting influence in governance decisions.

BUSFIN 1200 AU2025 (2014) Final Exam- Requires Respondus LockDown Browser

If you wish to have a direct voice in the running of a company, you should purchase

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BUSFIN 1200 AU2025 (2014) Final Exam- Requires Respondus LockDown Browser

If you wish to have a direct voice in the running of a company, you should purchase

查看解析

登录即可查看完整答案

类似问题

If you believe that a firm will grow rapidly in the future, you should buy its

Part 1Common stock is a vehicle for selling ownership and another way to raise money for​ operations, expansion, or other business needs. Part 1 True False

Which of the following is not true about common stock?

Which of the following is NOT true about common stock?

Which of the following is not a characteristic of common stock?

Which one of the following types of stock is defined by the fact that it receives no preferential treatment in respect to either dividends or bankruptcy proceedings?

Which one of the following types of stock is defined by the fact that it receives no preferential treatment in respect to either dividends or bankruptcy proceedings?

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希望你的学习变得更简单

Part 1Common stock is a vehicle for selling ownership and another way to raise money for operations, expansion, or other business needs. Part 1 True False