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FrozenT [24]
3 years ago
8

Which best explains what it means for a company to sell its stock?

History
2 answers:
gregori [183]3 years ago
8 0

The correct answer is: "Companies are selling shares of ownership and a share of its profits in exchange for money it can use to operate their business."

Shares are fractions of a corporation's social capital, which is equally divided in many pieces. Each of these shares is traded in stock markets. When investors buy stock from a company, they become owners of the company in the same proportion that the number of shares bought represents of the total social capital. Stockholders will make profit by receiving, every year, a percentage of the total profit generated by the company. The amount received is called dividend.

Moreover, stock investors can also make money by selling the shares at a higher price than the buying price. If the company functions properly and keeps on generating profits, the value of its stock in the financial markets will rise.

Ket [755]3 years ago
3 0

Answer: D, Companies are selling shares of ownership and a share of its profits in exchange for money it can use to operate their business.

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