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Economics
Stocks, Bonds, Business Forms Test review
| Question | Answer |
|---|---|
| Represents ownership | stocks |
| Force the company to pay the investor interest in returning for borrowing money. | bonds |
| An investor must consider this when buying stocks or bonds. | risk and reward |
| An investor with a diversified protfolio has holiding in | several different industries |
| This is based on the performance of 30 stocks | the Dow Jones Industrial average |
| They usually have a vote on major company decisions and directors | common stockholders |
| A retirement account that involves an after Tax deduction where no future earnings are taxed | Roth IRA |
| Profits made on investment in the form of higher stock prices | capital gains |
| A shareholder with a guaranteed dividend payment in a corportation hold | preferred stock |
| This is not clearly stated on a bond | dividend |
| The safest type of investment is | U.S. Savings Bond |
| The type of business where owners are NOT personally responsible for any damage | corporation |
| This business form can raise money the easiest | corporation |
| Thsi business form is considered and "artificial person" that can sue and be sued | corporation |
| A weakness of this type of business is that the business depends solely on the owner | sole proprietorship |
| This type of business does not have to pay a separate business tax | sole proprietorship |
| One advantage enjoyed by a corporation is | unlimited life |
| The most common form of business organization in the United States is the | sole proprietorship |
| This business form has the most difficulty raising capital | sole proprietorship |
| This business form is exposed to the most government regulation | corporation |
| This business form can change ownership the easiest | corporation |
| They set the direction of a company and hire a management team | Board of Directors |
| The component of a bond that states the interest rate | coupon |
| Investor who anticipates a decline in the value of a stock | Bear trader |
| Purchasing stock without paying full price | Buying on margin |
| Corporate profits paid to stockholders on a per share basis | Dividend |
| A certificate that represents debt owed by a corporation | Stock |
| A certificate that represents debt owed by a corporation | Bond |
| The business with continues to exist if ownership changes hands | Unlimited life |
| A business owned by two or more persons | Partnership |
| Business form which produced the majority of output in the U.S. economy | corporation |
| Partial owners of a corporation | stockholders |
| Individual ownership of a business | sole proprietorship |