Homework SourseWhich one of the following statements is true Equity securit
Which one of the following statements is true?
Equity securities offer fixed claims on future cash payouts.
Unlike bondholders, for their returns, shareholders rely entirely on price appreciation.
In theory, common shareholders exercise very little control over company decisions.
Historically, common shareholders have earned a risk premium as compensation for risk borne in excess of government bonds.
Preferred shareholders are the first investors to be repaid in bankruptcy liquidation.
None of the above.
| Equity securities offer fixed claims on future cash payouts. | ||
| Unlike bondholders, for their returns, shareholders rely entirely on price appreciation. | ||
| In theory, common shareholders exercise very little control over company decisions. | ||
| Historically, common shareholders have earned a risk premium as compensation for risk borne in excess of government bonds. | ||
| Preferred shareholders are the first investors to be repaid in bankruptcy liquidation. | ||
| None of the above. |
Solution
Historically, common shareholders have earned a risk premium as compensation for risk borne in excess of government bonds.
Rest all are false
