What is one difference between stocks and bonds?

Question

Quizplus · Accepted Answer

Stocks represent partial ownership in a firm, while bonds represent a form of debt where the issuer borrows money and pays back the principal plus interest to the bondholder. Therefore, this is the main difference between stocks and bonds. Option A and B are incorrect as the rate of return varies based on the issuing company's financial performance and market conditions. Option C is also incorrect as both stocks and bonds can be purchased through various means, including banks and the government.

What Is One Difference Between Stocks and Bonds