A share of stock gives its holder a claim to a firm's profit stream and the corporation honors this claim by paying interest to the stockholders.

Question

Quizplus · Accepted Answer

A share of stock gives its holder a claim to a firm's ownership and assets, but does not guarantee interest payments. Instead, the corporation pays dividends, which are a portion of the profits distributed to shareholders. However, not all corporations pay dividends, and the amount of dividend payments may vary over time.

A Share of Stock Gives Its Holder a Claim to a Firm's