When a household owns shares of stock, _____.
A)it has ownership rights in that firm
B)it is entitled to the majority of the firm's profits
C)it is liable to bear the entire loss faced by the firm
D)it can consume the firm's products without paying for it
E)it is responsible for correcting any defect in the product identified by the customers

Question

Quizplus · Accepted Answer

When a household owns shares of stock, it has ownership rights in that firm. This means that the shareholder has a claim on the assets and earnings of the firm, and a right to vote on management decisions and board elections. However, owning shares does not entitle the shareholder to the majority of the firm's profits, nor does it make them responsible for correcting any defect in the product identified by customers, as suggested in options B, C, D, and E.

When a Household Owns Shares of Stock, _____