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http://courses.aplia.com/af/servlet/quiz?quiz action-takeQuiz&iqu; Aplia: Student QuestionAAnswer All Questions Please.. Previous NextD options I X Find: It is common to refer to common stockholders as the "owners" of a firm, because investors in common stock have certain rights and privileges generally associated with property ownership. Common stockholders bear most of the risk associated with a firm's operations, but they tend to benefit the most when a firm performs well. Each of the statements below describes a term associated with common stock. Identify which statement corresponds with each term listed in the table below: Statement Income Stocks Growth Stocks Proxy Preemptive Right A type of stock that pays little or no dividends because the firm is retaining its earnings for future investment in the company Investors that rely on dividend income as a significant portion of their annual income tend to prefer this type of stock because it pays large, consistent dividends. This protects common stockholders from the management team of a firm issuing a large number of additional shares and purchasing these shares themselves in an attempt to gain greater control over the company Common stockholders have the right to elect a firm's board of directors, who in turn appoint the officers who manage the company. Most common stockholders transfer their right to vote to a second party through this instrument. Equity, or common stock, trades on stock markets all around the world. Because of globalization, the lines between equity markets are being blurred. In many cases, multinational firms sell equity in foreign equity markets. In other words, they sell stock on exchanges outside of their home country Sony, a Japanese multinational firm, issued stock that trades on the FTSE exchange in London The statement above is an example of which of the following? A Yankee stock O An American Depository Receipt (ADR) Session 59:18 A Euro stock Timeout 12:40 PM 4/8/2016Explanation / Answer
(1)
(a) Stock paying little or no dividend - Growth stock
(b) Investors relying on Dividend-paying stock - Income stock
(c) This prevents common shareholders - Preemptive right
(d) Shareholders transfer their right to vote - Proxy
(2) This is example of a Euro stock, which is issued in an European stock exchange (outside the country of the issuer).
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