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Select all that apply Why is it more difficult to evaluate a share of common stock than it is to evaluate bonds? More than one
Select all that apply Why is it more difficult to evaluate a share of common stock than it is to evaluate bonds? More than one answer may be correct. Multiple select question. The rate of return required by the shareholders is not easily observed. Common stock cash flows are not known in advance. Financial statements contain all the information related to bonds, but they do not provide any information related to common stock. The life of a bond is essentially forever, which makes it easy to evaluate a bond.
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