Which of the following statements is correct?
A)A corporation receives a monetary payment every time its shares of stock are traded by stockholders on organized stock exchanges.
B)When a corporation sells bonds as a means of raising funds it is engaging in debt finance.
C)A share of stock is an IOU.
D)The two most important financial markets in the economy are the stock market and financial intermediaries.

Question

Quizplus · Accepted Answer

Selling bonds is a form of debt finance because the corporation is borrowing money and agreeing to pay it back with interest at a later date.

Answer: D
 The stock market and financial intermediaries are both important financial markets in the economy. The stock market is where stocks and other securities are traded, while financial intermediaries like banks and insurance companies serve as a go-between for savers and borrowers.

Therefore, the best choices are B and D.

Which of the Following Statements Is Correct