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Which of the following is FALSE regarding the difference between debt and common stock? 1. Equity is ownership in a firm but debt is not.

Which of the following is FALSE regarding the difference between debt and common stock?

1.

Equity is ownership in a firm but debt is not.

2.

Stockholders have voting power while creditors do not.

3.

Periodic payments made to either class of security are tax deductible for the issuer.

4.

Interest payments are legally binding while dividend payments generally are not.

5.

A publicly-traded company can issue public stock and private debt, but not vice versa.

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