3. Which one of the following is a difference between debt and common stock? A) Debt is ownership in a firm but equity is not B) Creditors have voting power while stockholders do not C) Bondholders can also own equity, but stockholders cannot own bonds D) Interest payments are mandatory each year while dividend payments are not 4. The primary market is defined as the: A. Market for insured securities. B. over the counter market. C. Market for securities of the largest firms. D. Market for new issuance of securities E. None of the above. 1. Item that normally used by government and private entity as a long-term capital is A. Bond B. Preferred stock C. Common stock D. Retained earnings 2. The constant dividend growth model: I. assumes that dividends increase at a constant rate forever. II. required rate of return must be greater than the constant growth rate III. states that the market price of a stock is only affected by the amount of the dividend. IV. considers capital gains but ignores the dividend yield. A. I only B. II only C. III and IV only D. I and II only E. I, II, and III only