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Which of the following is a key characteristic of an equity security? Firms are contractually obligated to pay dividends on equity. Equity represents a loan

Which of the following is a key characteristic of an equity security?

  • Firms are contractually obligated to pay dividends on equity.

  • Equity represents a loan to the firm.

  • Equity represents ownership in a firm.

  • Equity has priority over debt in bankruptcy.

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