Question: Q50 A key difference between an equity contract and a debt contract is that equity _____, while debt _____. Group of answer choices has unpredictable

Q50 A key difference between an equity contract and a debt contract is that equity _____, while debt _____.

Group of answer choices

has unpredictable returns; always has a certain return

encourages firms to take excessive risk; encourages firms owners to loaf

pays dividends that are tax-deductible for firms; pays interest that is not tax-deductible for firms

promises a share of future profits; promises a fixed payment in the future

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

Please help with the discussion below: ** Each of the 3 questions below only need to beabout two-threepara graphs but packed full of information, no fluff. **Attached below are a few readings from...

Q:

(a) Assess the differences between a commercial bank and an investment bank. (7 marks) my answer for part a The key difference between commercial bank and investment bank are specified below:...

Q:

PowerPoint Presentation Present to executive management and the board of directors. Present an executive level presentation noting what was discovered. Powerpoint presentation of the two sections...

Q:

Researching changing consumer needs and desires for airline travel is a key aspect of American Airlines' business plan. Which of the following HR planning activities BEST supports this practice?...

Q:

American airlines case Researching changing consumer needs and desires for airline travel is a key aspect of American Airlines' business plan. Which of the following HR planning activities BEST...

Q:

Hi Erylee88, I would like to utilize your service again. Same format different questions. Please find attached document for your review. Let me know. Thank you, Sam...

Q:

Budgeting for Nonprofit Organizations Although budgeting is just as important for nonprofit organizations as for for-profit companies, the approach taken toward budgeting can be very different. In...

Q:

Budgeting for Nonprofit Organizations Although budgeting is just as important for nonprofit organizations as for for-profit companies, the approach taken toward budgeting can be very different. In...

Q:

IFRS Financial Statements Position Paper The purpose of this assignment is to increase your knowledge of IFRS. You will review a PowerPoint presentation and type responses to the questions asked...

Q:

Question 1 1 pts A biweekly mortgage: Group of answer choices has one rate adjustment after a set period, such as five years increases at regular intervals, with the increased payments used to pay...

Q:

Zack is preparing a college fund for his new born son. Today, Zack plans to buy ZERO coupon bonds that will mature when his son begins college in 18 years to cover tuition of $40000 for one year. A....

Q:

Common stock of PR Co. has an expected return of 12%. The expected market return is 14% and the risk-free rate is 2%. What is PR Cos beta coefficient?

Q:

Question 2 The income statements of Parent Ltd and Son Ltd for the year ended 3 1 March 2 0 0 6 are shown below. Parent Ltd owns 8 0 per cent of the shares in Son Ltd . Parent Ltd Son Ltd \ table [ [...

Q:

write a research title about work - life balance of employees in various sector

Q:

Learning is a good thing for everyone. Discuss.

Q:

What should be the role of managers in HRD?

Q:

What should be the role of government in HRD?