When an investor purchases a share of a firm's common stock, what does he or she...

When an investor purchases a share of a firm's common stock, what does he or she receive in return? (Select all that apply.)

Multiple select question.

A share in the company's future successes and setbacks

An ownership share in the firm

A guarantee of future dividends

A guaranteed constant increase in the market value of the share

Solutions

Expert Solution

The correct statements are:-

A share in the company's future successes and setbacks
An ownership share in the firm

The answer is not C) as no dividends are guaranteed with common stock, dividends are guaranteed only with preferred stock.

The answer is not D) as price of share is subject to market risk, so their is no guarantee the stock will increase in value.

jeff jeffy answered 1 year ago

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